Procedures: 1. Analyze the following business transactions below. For December, Mr. John Wick had the following transactions: Mr. John Wick invested P1,200,000 to start the business. The firm obtained a note from Mars Bank amounting to P300,000. The note bears a 6% annual interest payable every June 1 of the following year. The principal is payable in two (2) equal annual installments. 1 The firm paid P15,000 for the necessary permits and licenses for its operation. The firm paid P180,000 for the annual rent of the office space. The lease contract will expire on June 1 of the following year and will be renewed yearly. John Accounting Firm rendered service to Gatdula, Inc. worth P250,000 on credit. Purchased supplies worth P50,000. Rendered service to Caventa Company for P80,000. Purchased a laptop in cash, P50,000. The laptop has an estimated useful life of three (3) years, with no residual value. The company treats purchases during the first half of the month as a purchase at the start of the month. 14 Gatdula, Inc. paid the firm. 17 Mr. John Wick withdrew P80,000 for personal use. Ocampo Catering billed the firm for P40,000 for the services rendered to its holiday luncheon for 21 clients and staff. Received P75,000 cash in advance from Rivera, Inc. for the services that will be rendered next 24 year. 25 Rendered services to Gersaniva Company on credit, P120,000. 28 Rendered taxation services and billed the client, P45,000. 31 Paid P40,000 for the salary of its office staff and utilities worth P20,000. 3.
Procedures: 1. Analyze the following business transactions below. For December, Mr. John Wick had the following transactions: Mr. John Wick invested P1,200,000 to start the business. The firm obtained a note from Mars Bank amounting to P300,000. The note bears a 6% annual interest payable every June 1 of the following year. The principal is payable in two (2) equal annual installments. 1 The firm paid P15,000 for the necessary permits and licenses for its operation. The firm paid P180,000 for the annual rent of the office space. The lease contract will expire on June 1 of the following year and will be renewed yearly. John Accounting Firm rendered service to Gatdula, Inc. worth P250,000 on credit. Purchased supplies worth P50,000. Rendered service to Caventa Company for P80,000. Purchased a laptop in cash, P50,000. The laptop has an estimated useful life of three (3) years, with no residual value. The company treats purchases during the first half of the month as a purchase at the start of the month. 14 Gatdula, Inc. paid the firm. 17 Mr. John Wick withdrew P80,000 for personal use. Ocampo Catering billed the firm for P40,000 for the services rendered to its holiday luncheon for 21 clients and staff. Received P75,000 cash in advance from Rivera, Inc. for the services that will be rendered next 24 year. 25 Rendered services to Gersaniva Company on credit, P120,000. 28 Rendered taxation services and billed the client, P45,000. 31 Paid P40,000 for the salary of its office staff and utilities worth P20,000. 3.
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter3: Processing Accounting Information
Section: Chapter Questions
Problem 3.15MCE: Journal Entries Following is a list of transactions entered into during the first month of...
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Transcribed Image Text:Procedures:
1. Analyze the following business transactions below.
For December, Mr. John Wick had the following transactions:
Mr. John Wick invested P1,200,000 to start the business.
The firm obtained a note from Mars Bank amounting to P300,000. The note bears a 6% annual
interest payable every June 1 of the following year. The principal is payable in two (2) equal
1
The firm paid P15,000 for the necessary permits and licenses for its operation.
The firm paid P180,000 for the annual rent of the office space. The lease contract will expire on
June 1 of the following year and will be renewed yearly.
John Accounting Firm rendered service to Gatdula, Inc. worth P250,000 on credit.
annual installments.
3
Purchased supplies worth P50,000.
Rendered service to Caventa Company for P80,000.
Purchased a laptop in cash, P50,000. The laptop has an estimated useful life of three (3) years,
with no residual value. The company treats purchases during the first half of the month as a
purchase at the start of the month.
Gatdula, Inc. paid the firm.
17 Mr. John Wick withdrew P80,000 for personal use.
Ocampo Catering billed the firm for P40,000 for the services rendered to its holiday luncheon for
14
21
clients and staff.
Received P75,000 cash in advance from Rivera, Inc. for the services that will be rendered next
24
year.
25 Rendered services to Gersaniva Company on credit, P120,000.
28 Rendered taxation services and billed the client, P45,000.
31
Paid P40,000 for the salary of its office staff and utilities worth P20,000.
Transcribed Image Text:Refer to the chart of accounts below as the amounts are posted in the ledger.
CHART OF ACCOUNTS
Account
Number
201
202
203
Account
Number
101
Account
Number
401
501
503
Account Name
Account Name
Account Name
Cash
Accounts Receivable
Office Supplies
Accounts Payable
Notes Payable
Unearned Revenue
Professional Fees
Salaries Expense
Utilities Expense
Representation
Expense
Permits and Licenses
Expense
102
103
104
Prepaid Rent
301
J. Wick, Capital
504
105
Office Equipment
302
J. Wick, Drawing
508
Required:
a. Journalize the following transactions. No need to include the description.
b. Post the journal entries to the ledger.
c. Create a trial balance.
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