ACCOUNTING PRACTICE SET

Business forms are used to document business transactions. It contains information relevant to the transaction such as date of transaction, items
bought or sold, price, tax and name of buyer and seller. More importantly, business forms document accountability – identification of personnel who
performed specific functions related to the transaction. The business forms also show that established policies and procedures are followed in
implementing the transaction.

DIFFERENT KINDS OF BUSINESS FORMS:

1. Internal business forms – forms used only within the business.

- Purchase request – to document the processes involve prior to sending a confirmed order to the seller. This may include getting quotations from
various suppliers and securing budgetary approval to ensure there is funding for the purchase.
- Check vouchers – used to document the disbursement process. Used to document the following reconciliation process: orders are authorized,
deliveries are from valid orders, and purchase invoices represent actual deliveries and agreed upon price.

2. External business forms – forms used by both buyer and seller. - Purchase order – a form prepared by the buyer and sent to the seller to document
the order and agreed upon terms of the purchase.
- Delivery receipts–a form prepared by the seller, with a copy given to the buyer, to document the delivery of the items ordered.
- Purchase /Sales invoice –It contains information on the prices of the items delivered and the terms of the purchase. This should be consistent with
the information on the purchase order. The purchase invoice and sales invoice are the same form. It is referred to as purchase invoice by the buyer
because it documents its purchase transaction. On the other hand, the same form is referred to as sales invoice by the seller to document its sale
transaction.
- Official receipts – used to document cash transaction. The entity receiving the cash will prepare the Official Receipts (OR). The entity paying will
receive the OR as evidence of payment made.

Business Forms Accounting books

Check voucher (check voucher Cash disbursement book
package includes purchase
request, purchase order,
delivery receipts and purchase
invoice), suppliers’ official
receipt received for cash
payment.
Official receipt issued for cash Cash receipts books
payment and cash register tapes
Sales invoice issued to Sales journal
customers.
Purchase invoice received from Purchases journal
seller.
 Accounting Practice Set
AngTindahan Co. is a wholesaler of office and school supplies. The following are the transactions of AngTindahan Co. for the first month of its
operations. All cash disbursements are made by bank check. Assume perpetual inventory method is used.
Date Transaction Amount Business/Bank forms Journal Journal Entry
to be filled up

July 1 Rachel Dy made initial contribution to the business by depositing P200,000 Deposit slip Cash receipt Cash
money in the company’s bank account. journal Dy, Capital

July 1 Purchased laptop from Computer shop Inc. for office use. Payment 45,000 Purchased Order Purchase Office equipment
term: COD (Cash on Delivery). Purchase Invoice, journal Accounts payable
check voucher
July 2 Paid advance rental for 6 months 30,000 Check voucher Cash Prepaid expense
Disbursement Cash

July 4 Received 200 reams of bond papers (inventory) ordered from Jude 25,000 Purchase invoice, Purchase Inventor
Corp. Payment terms: 2/10, n/30. check voucher journal Accounts Payable

July 7 Delivered150 reams of bond papers to Aurora Company. Payment 41,250 Delivery receipt, sales Sales journal Accounts Receivable
terms: 2/10, n/20. Cost of merchandise was P18,750. invoice, official receipt Sales
Cost of Sales
Merchandise
Inventory

July 8 Paid the July 4 purchases 24,500 Check voucher Cash Accounts Payable
Disbursement Merchandise
Inventory
Cash

July 15 Paid salary of employee 7,000 Check voucher Cash Salaries Expense
disbursement Cash

July 16 Received payment from the July 7 sales. 40,425 Official receipt Cash Receipt Cash
Journal Sales discount
Account Receivable

July 18 Sold 20 reams of bond papers to Audrey Company. Audrey picked 5,500 Sales Invoice Sales Journal Accounts Receivable
up the merchandise from the store. Payment term: 15 days. Cost of Sales
merchandise was P2,500
Cost of Sales
Merchandise
Inventory

July 19 Received10 boxes of ballpoint pens from Mickey Inc. Payment 25,000 Purchase Invoice, Cash Inventory
terms: COD purchase order, check disbursement Accounts Payable
voucher book

July 22 Over the counter sale of 4 boxes of ballpoint pens to Happy 22,000 Sales invoice, official Cash receipt Cash
Company. Cost of merchandise was P 10,000 receipt journal Sales
Cost of Sales
M.I

July 23 Received 10 calculators from Plusminus Corporation. Payment 3,000 Purchase invoice, Purchase Inventory
terms: 30 days purchase order, check journal Accounts Payable
voucher
July 24 Sold 6 calculators to Joel Company. Joel picked up the 3,960 Sales invoice Sales journal Accounts Receivable
merchandise from the store. Payment Term: 15 days. Cost of Sales
merchandise was P1,800 Cost of Sales
Merchandise Inventory

July 25 Paid electricity bill 7,400 Check voucher Cash Utilities expense
disbursement Cash

July 26 Received 2 defective calculators from Joel Company. Cost of 1,320 Cash Sales Return
defective calculators is P 600 Disbursement Accounts Receivable
journal Merchandise Inventory
Cost of Sales

July 31 Over the counter cash withdrawal by the owner, Rachel Dy, for her 10,000 Withdrawal slip Cash Dy Drawing
personal expenses. disbursement Cash
journal

Chart of Accounts
 Account Number Account Name Account Number Account Name
1000 Cash 4100 Sales
1200 Accounts Receivable 4101 Sales Returns and Allowances
1201 Allowance for Bad Debts 4102 Sales Discount
1300 Inventory 5100 Cost of Sales
1400 Prepaid Expenses 6100 Salaries Expense
1600 Office Equipment 6150 Supplies Expense
1601 Accum. Deprn - Off Eqpt 6200 Utilities Expense
1800 Land 6250 Travel Expense
2000 Accounts Payable 6300 Rental Expense
2100 Notes Payable 6350 Fuel Expense
2201 Salaries Payable 6400 Advertising Expense
2202 Utilities Payable 6450 Commissions Expense
3000 Dy, Drawings 6500 Depreciation Expense
3100 Dy, Capital 6700 Interest Expense

Requirements:
1. Identify the following and indicate on the spaces provided:
a. Business or bank forms to be used by Ang Tindahan to document the above transactions.
b. Journal to be used to record the original entry for the respective transactions.
2. Prepare the journal entry (debit-credit format) to record the above transactions. Use only the accounts listed on the chart of accounts given below.
3. Fill up the relevant forms based on the answer in 1a. Format of the forms are provided below. Reproduce the necessary forms. Follow the
numbering instructions.
4. Based on your answer in 1b, record the transactions in the appropriate journals. Formats are also provided below.
5. Post the journal entries in the appropriate subsidiary ledgers and general ledger accounts. Formats are also provided below.
6. Summarize the ledger accounts and list the balances on the trial balance.
7. Record the following adjusting entries. a. Accrual of one month rent b. One month depreciation of laptop computer. Estimated life is 5 years. c.
Accrue employee salary, P 7,000
8. Prepare the financial statements from the trial balance.
9. Prepare necessary closing entries and record on the general journal and ledger.
10. Perform financial statement analysis on the completed financial statements

Accounts Receivable - Subsidiary Ledger Accounts Payable - Subsidiary Ledger

Customer ID Number Customer Name Supplier ID Number Supplier Name
1200-00001 Audrey Company 2000-00001 Computershop Inc.
1200-00002 Aurora Company 2000-00002 Jude Corp.
1200-00003 Happy Company 2000-00003 Plusminus Corporation
1200-00004 Joel Company

Business Forms
Instruction for business and bank forms: 1. Reproduce the forms based on the number of transactions to be documented. 2. Provide the last digit of the
business form numbers. Begin with 1 for the first form used. Example, first bank check used should be numbered Check Number 000432651. The
second bank check used should be Check Number 000432652.
 General Journal
Page Number 1
DATE DESCRIPTION REF DEBIT
July 1 Cash GL-1 1000 200, 000
Dy, Capital GL-2 3100
To record owner’s investment

J 1 Office Equipment GL-2 1600 45, 000

Accounts Payable GL-2 2000
To record purchased laptop

2 Prepaid Expense GL-1 1400 30, 000

Cash GL-1 1000
To record paid rent

4 Inventory GL-1 1300 25, 000

Accounts Payable GL-2 2000
To record received inventory

7 Accounts Receivable GL-1 1200 41, 250

Sales GL-3 4100
To record delivery inventory

Cost of Sale GL-3 5100 18, 750

Merchandise Inventory GL-1 1300
To record cost of merchandise

8 Accounts Payable GL-2 2000 25, 000

Merchandise Inventory GL-1 1300
Cash GL-1 1000
To record paid purchases

15 Salaries Expense GL-3 6100 7, 000

Cash GL-1 1000
To record paid salaries

16 Cash GL-1 1000 40, 425

Sales Discount GL-2 4102 825
Accounts Receivable GL-1 1200
To record received payment from sales

July 18 Accounts Receivables GL-1 1200 5, 500

Sales GL-2 4100
To record sold inventory on account

Cost of Sale GL-3 5100 2, 500

Merchandise Inventory GL-1 1300
To record cost of merchandise

19 Inventory GL-1 1300 25, 000

Cash GL-1 1000
To record received inventory

22 Cash GL-1 1000 22, 000

Sales GL-2 4100
To record sold merchandise