Mr. Batu Gan commenced business on January 1, 2018 and put up a capital of Php1,000,000.

00
in cash. On the same date he opened a bank account with Bee Dee Oh and deposited
Php500,000.00. The following transactions took place on the month of January and February:

Jan 1 Bought goods for his business from Ms. Pa Ngit worth Php100,000.00 and paid cash.
Jan 2 Sold goods to Bu Ang Co. on credit worth Php20,000.00.
Jan 2 Paid cash for rent in advance good for two months (January and February);
Php5,000.00/month.
Jan 10 Acquired a vehicle worth Php200,000.00; Php100,000.00 was paid by check and the
remaining balance of Php100,000.00 was paid by obtaining loan from Bee Dee Oh;
useful life is 7 years, use straightline method for depreciation
Jan 15 Acquired furniture on credit from Lig On Co. worth Php75,000.00; useful life 3 years, use
straightline method for depreciation
Jan 18 Sold goods for cash worth Php30,000.00
Jan 25 Bought additional goods from Ms. Pa Ngit worth Php50,000.00 on credit
Jan 28 Bought office supplies in cash worth Php5,000.00
Jan 30 Paid telephone bill by check worth Php1,000.00
Jan 30 Received a bill from Electric Co. for electric bill worth Php2,000.00
Jan 30 VAT due for the month of January is Php2,500.00
Jan 30 Total Gross Salary for the month of January is Php15,300.00; deductions are the
following: SSS (Php100.00), PHIC (Php100.00) and HDMF (Php100.00); employer’s share
is the same with employees’ share
Jan 30 Half of the office supplies has been utilized
Feb 2 Paid the electric bill by check
Feb 3 Issued check for the salary and contributiond for the month of January
Feb 10 Buang Co. paid check for his credit
Feb 15 Withdraw cash from the bank worth Php75,000.00 and paid the said amount to Lig On
Co.
Feb 20 Issued a Post Dated Check (PDC) to Ms. Pa Ngit for his credit
Feb 20 Paid cash for the VAT due for January

Use the following Account Titles in recording:

ASSETS
Account Code Account Title
101 Cash on Hand
102 Cash in Bank – Bee Dee Oh
103 Petty Cash Fund
111 Accounts Receivable – Bu Ang
112 Due from Employees
113 Due from Officers
114 Notes Receivables
121 Inventories
131 Unused Office Supplies
141 Prepaid Rent
151 Office Equipment
251 Accumulated Depreciation – Office Equipment
152 Furniture & Fixtures
252 Accumulated Depreciation - Furniture & Fixtures
161 Vehicles
261 Accumulated Depreciation – Vehicles
LIABILITIES
Account Code Account Title
301 Accounts Payable – Pa Ngit
302 Accounts Payable – Lig On
303 Accrued Rent
304 Accrued Electric Expense
305 Unearned Income
306 Salaries Payable
307 SSS Payable
308 PHIC Payable
309 HDMF Payable
310 VAT Payable
321 Loans Payable – Bee Dee Oh
EQUITY
Account Code Account Title
401 Owner’s Capital
INCOME
Account Code Account Title
501 Sales
EXPENSES
Account Code Account Title
601 Used Office Supplies
602 Rent Expense
603 Communications Expense
604 Electric Expense
605 Salaries & Wages
606 SSS Contributions
607 PHIC Contributions
608 HDMF Contributions
609 Value Added Tax
610 Depreciation Expense
Answers:
Jan 1 Cash on Hand Php1,000,000.00
Owner’s Capital Php1,000,000.00

Jan 1 Cash in Bank – Bee Dee Oh Php500,000.00

Cash on Hand Php500,000.00

Jan 1 Inventories Php100,000.00

Cash on Hand Php100,000.00

Jan 2 Accounts Receivable – Bu Ang Co. Php20,000.00

Sales Php20,000.00
Jan 2 Prepaid Rent Php10,000.00
Cash on Hand Php10,000.00

Jan 10 Vehicles Php200,000.00

Cash in Bank – Bee Dee Oh Php100,000.00
Loans Payable - Bee Dee Oh Php100,000.00

Jan 15 Furniture & Fixtures Php75,000.00

Accounts Payable – Lig On Php75,000.00

Jan 18 Cash on Hand Php30,000.00

Sales Php30,000.00

Jan 25 Inventories Php50,000.00

Accounts Payable – Pa Ngit Php50,000.00

Jan 28 Unused Office Supplies Php5,000.00

Cash Php5,000.00

Jan 30 Communications Expense Php1,000.00

Cash in Bank – Bee Dee Oh Php1,000.00

Jan 30 Electric Expense Php2,000.00

Accrued Electric Expense Php2,000.00

Jan 30 Value Added Tax Php2,500.00

VAT Payable Php2,500.00

Jan 30 Salaries & Wages Php15,300.00

 SSS Payable Php100.00
PHIC Payable Php100.00
HDMF Payable Php100.00
Salaries Payable Php15,000.00

Jan 30 Used Office Supplies Php2,500.00

Unused Office Supplies Php2,500.00
Jan 30 Rent Expense Php5,000.00
Prepaid Rent Php5,000.00

Jan 30 Depreciation Expense – Vehicles Php1,612.90(computed from Jan 10)

Accumulated Depreciation - Vehicles Php1,612.90

Jan 30 Depreciation Expense – Furniture & Fixtures Php1,075.27

Accum. Dep. – Furnitures & Fixtures Php1,075.27

Feb 2 Accrued Electric Expense Php2,000.00

Cash Php2,000.00

Feb 3 SSS Payable Php100.00

PHIC Payable Php100.00
HDMF Payable Php100.00
SSS Contributions Php100.00
PHIC Contributions Php100.00
HDMF Contributions Php100.00
Salaries Payable Php15,000.00
Cash Php15,600.00

Feb 10 Cash in Bank – Bee Dee Oh Php20,000.00

Accounts Receivable – Bu And Php20,000.00

Feb 15 Cash on Hand Php75,000.00

Cash in Bank – Bee Dee Oh Php75,000.00

Accounts Payable – Lig On Php75,000.00

Cash on Hand Php75,000.00

Feb 20 VAT Payable Php2,500.00

Cash on Hand Php2,500.00

Feb 28 Rent Expense Php5,000.00

 Prepaid Rent Php5,000.00

Jan 30 Depreciation Expense – Vehicles Php2,380.95

Accumulated Depreciation - Vehicles Php2,380.95

Jan 30 Depreciation Expense – Furniture & Fixtures Php2,083.33

Accum. Dep. – Furnitures & Fixtures Php2,083.33