Gina H.

Adanza

AEC 12 – ACB

PROBLEM

Mr. Rolly Salcedo opened an auto repair shop with a trade name Magic Repair Shop. The transactions during the first
month of operations are as follows:

Feb. 1 – Rolly Salcedo invested the following items in the business:

Cash Php100,000

Shop tools Php 40,000

2 – Purchased shop supplies on account, Php4,000

3 – Rendered repair services on account, Php5,000

5 – Paid rent space for 2 months, Php4,000

8 – Purchased office equipment for cash, Php10,000

10 – Rendered repair services for cash, Php3,000

12 – Collected 40% of the account on February 3 transaction

14 – Billed various customers for repair services, Php7,000

15 – Paid Php5,000 for salary of shop workers covering the first half of the month

18 – Withdrew Php2,000 for personal use

20 – Collected the balance of the February 3 transaction

24 – Paid in full the supplies purchased

26 – Rendered repair services amounting to Php5,000, and received a note from the customer

28 – Paid the salary of the shop workers covering the 2nd half of the month, Php5,000

CHART OF ACCOUNTS

Cash Accounts payable Office equipment

Shop tools Accounts receivable Salaries expense

Salcedo, Capital Service income Salcedo, Withdrawals

Supplies expense Rent expense Notes receivable