Chart of Accounts Sales Discount 403

Gain on Sale of Noncurrent Assets 404

ACCOUNT TITLE PR
Investment Income 405
Cash 101
Interest Income 406
Short-term Investment 102
Other Gains 407
Accounts Receivable 103
Purchases 408
Allowance for Bad Debts 104
Purchase Discount 409
Inventory 105
Purchase Returns and Allowances 410
Supplies 106
Freight-in 411
Prepaid Expenses 107
Selling - Salaries Expense 412
Other Current Assets 108
Selling - Marketing and Promotions Expense 413
Selling - Rent Expense 414
Equipment 120
Selling - Depreciation Expense 415
Accumulated Depreciation - Equipment 121
Selling - Supplies Expense 416
Furniture and Fixtures 122
Selling - Utilities Expense 417
Accumulated Depreciation - Funiture and Fixtures 123
Selling - Other Expense 418
Intangibles 124
Admin. - Salaries Expense 419
Accumulated Amortization - Intangibles 125
Admin. - Marketing and Promotions Expense 420
Other Noncurrent Assets 126
Admin. - Rent Expense 421
Admin. - Depreciation Expense 422
Accounts Payable 201
Admin. - Supplies Expense 423
Salaries Payable 202
Admin. - Utilities Expense 424
Utilities Payable 203
Admin. - Insurance Expense 425
Other Current Liabilities 204
Admin. - Other Expense 426
Loss on Sale of Noncurrent Assets 427
Notes Payable 221
Loss from Investment 428
Other Long-term Liabilities 222
Interest Expense 429
Other Losses 430
Ann, Capital 301
Income Summary 431
Ann, Withdrawals 302

Sales 401
Sales Returns and Allowances 402
Instructions:
1. Record the transaction into your journal using account titles and posting
references from the attached chart of accounts while applying the
mentioned accounting policies as necessary.
2. Should you have any clarifications, leave a few lines and skip the item.
We will discuss the clarifications during class hours whenever time permits.
3. Be prepared by Friday, August 30, 2019, with the journal entries for a
quick inspection. Additional journal entries and instructions will be given for
the month-end preparations.
Notes on the accounting policies used:
1. Prepaid assets are recorded using the expense method.
2. The business uses the periodic method for accounting for inventories.
3. Purchases on account are recorded using the gross method.
Transactions to be journalized:
1. Aug. 2 - purchased inventory on account amounting to P71,000. Paid
P1,300 for the freight-in. Purchased stores and office supplies
amounting to P3,000 and P2,000 respectively for cash.
2. Aug. 2- earned cash sales totaling P17,900 and credit sales totaling
P32,400. The sales were from sales invoices nos. 0001 to 0045.
3. Aug. 5- earned cash sales totaling P12,000 and credit sales totaling
P30,000. The sales were from sales invoices nos. 0046-0089
4. Aug. 5 - allowed a P1,300 discount on sales for slight quality concerns
by customer.
5. Aug. 7- earned cash sales totaling P11,600 and credit sales totaling
P21,200. The sales were from sales invoices nos. 0090-0141.
6. Aug. 7 - Collected P30,100 of the credit sales.
7. Aug. 9 - purchased inventory on account amounting to P80,000. Paid
P1,300 for the freight-in.
8. Aug. 9- earned cash sales totaling P10,090 and credit sales totaling
P34,000. The sales were from sales invoices nos. 0142-0187.
9. Aug. 9 - Collected P35,000 of the credit sales.
10. Aug. 9 - allowed a P1,300 discount on sales for delayed deliveries.
11. Aug. 9 - paid water and electricity bills totaling P610 for the Aug 1
and Aug 2 which the lessor collected from the business.
12. Aug. 12- earned cash sales totaling P17,090 and credit sales totaling
P35,100. The sales were from sales invoices nos. 0188-0231.
13. Aug. 12 - collected P20,900 of the credit sales.
14. Aug. 12 - Ann withdraws P50,000.
15. Aug. 14- earned cash sales totaling P16,750 and credit sales totaling
P27,000. The sales were from sales invoices nos. 0232-0281.
16. Aug. 14 - collected P30,000 cash from and provided a P340 cash
discount on the credit sales.
17. Aug. 14 - provided a P1,100 discount on sales to a customer who was
dissatisfied with the service of the business.
18. Aug. 16 - made purchases on account amounting to P90,000. Paid
freight-in of P1,300 for the purchases.
16. Aug. 16- earned cash sales totaling P15,250 and credit sales totaling
P32,000. The sales were from sales invoices nos. 0282-0330.
17. Aug. 16 - collected P30,000 cash from and provided a P340 cash
discount on the credit sales.
18. Aug. 16 - settled a P71,000 accounts payable and obtained a 2.5%
cash discount.
19. Aug. 16 - Paid salaries to two office clerks (P4,800 and P5,200) and
two salesmen (P5,250 and P5,750 each) for the payroll period Aug. 1 to
Aug. 15.
20. Aug. 19- earned cash sales totaling P14,500 and credit sales totaling 36. Aug. 30 - earned cash sales totaling P15,870 and credit sales totaling
P38,000. The sales were from sales invoices nos. 0331-0373. P37,000. The sales were from sales invoices nos. 0556-0601.

21. Aug. 19 - Collected P22,000 accounts receivables. 37. Aug. 30 - Collected P34,00 of the accounts receivables.

22. Aug. 21- earned cash sales totaling P16,750 and credit sales totaling 38. Aug. 30 - settled a P90,000 accounts payable and obtained a 2.5%
P35,100. The sales were from sales invoices nos. 0374-0422. cash discount.

23. Collected P27,000 accounts receivables.
24. Aug. 23 - made purchases on account totaling P74,000. Paid cash on
freight-in cost amounting to P1,200. Purchased stores and office
supplies amounting to P4,200 and P3,800 respectively for cash.
25. Aug. 23- earned cash sales totaling P12,760 and credit sales totaling
P26,000. The sales were from sales invoices nos. 0423-0471.
39. Aug. 30 - paid rent for the month of September. P3,000 is for the
office are while P13,000 is for the stores area.
40. Aug. 31 - Paid salaries to two office clerks (P4,800 and P5,200) and
two salesmen (P5,250 and P5,750 each) for the payroll period Aug. 16 to
Aug. 31.

26. Aug. 23 - Collected P36,00 of the accounts receivables.

27. Aug. 23 - allowed sales returns of P1,100 for communication

concerns encountered with a client.

28. Aug. 23 - settled an P80,000 accounts payable and obtained a 2.5%

cash discount.

29. Aug. 26- earned cash sales totaling P13,500 and credit sales totaling
P32,700. The sales were from sales invoices nos. 0472-0511.

30. Aug. 26 - Collected P34,00 of the accounts receivables.

31. Aug. 26 - Ann withdrew P50,000.

32. Aug. 28- earned cash sales totaling P9,250 and credit sales totaling
P31,000. The sales were from sales invoices nos. 0512-0555.

33. Aug. 28 - collected P27,000 cash from and provided a P260 cash
discount on the credit sales.

34. Aug. 28 - allowed sales returns of P700 for communication concerns

encountered with a client.

35. Aug. 30 - made purchases on account totaling P85,000. Paid cash on

freight-in cost amounting to P1,200.