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    Louie Anne R. Lim - 03 Activity 1

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    Louie Anne Lim
    The document provides accounting information for two cases - PM Company and Margarita Gonzales Law Office. For PM Company, it calculates total current assets as of December 31, 2X14. For Margarita Gonzales Law Office, it lists transactions during the first month of operations in January 2X20 and provides the necessary journal entries and statement of financial position as of January 31, 2020.

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    Louie Anne R. Lim - 03 Activity 1

    Uploaded by

    Louie Anne Lim
    262 views3 pages
    The document provides accounting information for two cases - PM Company and Margarita Gonzales Law Office. For PM Company, it calculates total current assets as of December 31, 2X14. For Margarita Gonzales Law Office, it lists transactions during the first month of operations in January 2X20 and provides the necessary journal entries and statement of financial position as of January 31, 2020.

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    LOUIE ANNE R. LIM - 03 ACTIVITY 1

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    The document provides accounting information for two cases - PM Company and Margarita Gonzales Law Office. For PM Company, it calculates total current assets as of December 31, 2X14. For Margarita Gonzales Law Office, it lists transactions during the first month of operations in January 2X20 and provides the necessary journal entries and statement of financial position as of January 31, 2020.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    262 views3 pages

    Louie Anne R. Lim - 03 Activity 1

    Uploaded by

    Louie Anne Lim
    The document provides accounting information for two cases - PM Company and Margarita Gonzales Law Office. For PM Company, it calculates total current assets as of December 31, 2X14. For Margarita Gonzales Law Office, it lists transactions during the first month of operations in January 2X20 and provides the necessary journal entries and statement of financial position as of January 31, 2020.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 3

    NAME: LOUIE ANNE LIM SECTION: BSAIS102A DATE: APRIL 03, 2022

    CASE 1: PM COMPANY

    PM Company provided the following adjusted account balances on December 31, 2X14:

    Wages payable P250,000


    Cash 200,000
    Mortgage payable 1,500,000
    Dividends payable 150,000
    Prepaid rent 100,000
    Inventory 800,000
    Sinking fund 500,000
    Short-term investments 300,000
    Taxes payable 220,000
    Accounts payable 240,000
    Accounts receivable 350,000

    Requirement: Compute for the total current assets on December 31, 2X14 (5 points).

    ASSETS
    Currents Assets
    Cash 200,000
    Accounts Receivable 350,000
    Prepaid Rent 100,000
    Inventory 800,000
    Short term investment 300,000
    Total Current Assets 1,750,000

    CASE 2: Margarita Gonzales Law Office

    Margarita Gonzales Law office was established on January 1, 2X20, and the following events occurred
    during the first month of operation:

     Margarita invested P100,000 cash as working capital to start her business


     Purchase of furniture’s for P30,000, 50% paid in cash and 50% taken as a credit
     She signed two (2) service contract:

    1.) with XYZ for services performed during the month in the amount of P4,000; and

    2.) with ABC for services that will be performed during the first week of next month for P5,000.
    Margarita received an advance of P20,000 with the signature of this contract.

     The furniture bought has a useful life of 30-month and should be depreciated straight line.
     Margarita agreed to pay her assistant P15,000 for the service performed of which she paid already
    P10,000
     XYZ paid P20,000
     Rent for the month of P10,000 was paid through a bank transfer.
     An electricity bill for P3,000 was received by mail
    Requirement: Based on the given information, do the following (2 items x 5 points):

    1. Necessary journal entries; and

    2. Statement of financial position for the month ending January 31, 2020.

    JOURNAL ENTRY
    REF ACCOUNTS DESCRIPTION DEBIT CREDIT
    1 Cash in Bank 100,000
    Capital 100,000
    To record the owner investment to start the business

    2 Furniture 30,000
    Cash 15,000
    Accounts Payable 15,000
    To record the purchased of furniture 50% paid in cash &
    50% taken as credit

    3 Cash and Bank 20,000


    Unearned Revenue 20,000
    To record the advance received in contract signing

    Service Revenue 4,000


    Cash 4,000
    To record the payment received in services performed

    4 Depreciation-Furniture 1,000
    Accumulated Depreciation Furniture 1,000
    ( Current month depreciation amounted)
    (30,000/30=1,000)

    5 Salary expense 15,000


    Cash 10,000
    Salary payable 5,000
    To record the part salary paid to employees

    6 Cash and Bank 20,000


    Accounts Receivable 20,000
    Service Revenue 40,000
    (per contract of XYZ current month service = 40,000)
    To record the part payment received
    10,000
    7 Rent expense 10,000
    Cash and Bank
    To record the rent paid

    8 Electricity expense 3,000


    Electricity Payable 3,000
    To record the bill received unpaid
    Margarita Gonzales Law Office
    Statement of Financial Position
    For the year ending January 31, 2020

    ASSETS
    Current Assets
    Cash and Bank 105,000
    Accounts Receivable 20,000

    Total Current Assets 125,000

    Non- Current Assets


    Furniture 30,000
    Less: Accumulated Depreciation -1,000

    Total Non-Current Assets 29,000

    Total Assets 154,000

    LIABILITIES
    Current Liabilities
    Accounts Payable 15,000
    Salary Payable 5,000
    Electricity Payable 3,000
    Unearned Income 20,000
    Retained Earnings 11,000

    Total Current Liabilities 54,000

    OWNER’S EQUITY
    Capital 100,000

    Total Liabilities and Owner’s Equity 154,000

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