Dr Beza Alemu established a sole proprietorship form of Business known as Beza Clinic.

Beza Clinic
Chart of Accounts
Account Title Account Number
Assets
Cash………………………………………………… 111
Accounts Receivable………………………………. 112
Prepaid Rent ………………………………………. 113
Prepaid Insurance …………………………………. 114
Office Supplies……………………………………… 115
Medical Supplies…………………………………… 116
Office Equipment………………………………….. 117
Medical Equipment………………………………… 118
Building……………………………………………. 119
Accumulated Deprecation Office equipment ……… 120
Accumulated Deprecation Medical equipment ……. 121
Accumulated deprecation building ………………. 122
Liability
Accounts Payable …………………………………. 211
Salaries payable …………………………………… 212
Capital
Beza’s Capital ……………………………………… 311
Beza’s Drawing ……………………………………. 312
Income Summary…………………………………… 313
Revenues
Medical Fees……………………………………….. 411
Expenses
Rent Expense………………………………………. 511
Salary Expense……………………………………. 512
Utility Expense ………………………………….. 513
Deprecation Expense ……………………………… 514
Supplies Expense………………………………….. 515
Insurance Expense…………………………………. 516
Misc, Expense ……………………………………. 517
The following are business transactions Beza Clinic Conducted during the
month of December, 2009

Dec 1. Purchased office supplies for Br 1,200

1. Purchased medical supplies for Br 10,000 on account from Ethio-Impex
1. Paid Br 30,000 Rent for the coming three months.
1. Paid Br 18,000 insurance for the coming three months.
2. Purchase medical Equipment for Br 50,000 on account from Ethio-Impex
3. Paid Br 6,000 to Ethio-Impex for medical Supplies which was purchased on account
5. Paid Br 30,000 Salary to employees.
6. Purchased two computers on cash at a cost of Br 5,000 each for office use.
7. Received Br 60,000 medical fee from patients.
8. Purchased chairs and tables for Br 12,000 from 3F on credit.
10. Paid Br 4,000 to Ethio-Impex for medical supplies which was purchased on account.
12. Purchased stationary materials for Br 2000 on cash from Universal Stationary
14. Provide medical treatment service to patients on credit for Br 60,000
15. Paid Br 30,000 to Ethio-Impex for medical equipments for previous purchased on account.
18. Paid Br 200 for water consumption
19. Paid Br 250 for electricity
20. Withdraw Br 10,000 cash for personal use
22. Received Br 50,000 from patients on account
25. Received Br 80,000 medical fee
26. Paid Br 20,000 for purchase of medical supplies
27. Paid Br 1,500 cash for telephone bill
28. Paid Br 500 for painting
29. Purchased medical supplies for Br 80,000 on account from Ethio-Impex
30. Paid Br 600 for miscellaneous expenses.

Required: a) Record the above transactions in a General journal form.

b) Post entries to individual accounts in the ledger
C) Prepare trial balance
 Beza Clinic
General Journal Page 1
Date Account Title P/R Debit Credit
Dec 1 Office supplies 115 1200 00
Cash 111 1200 00
Dec 1 Medical Supplies 116 10,000 00
Accounts payable 211 10,000 00
Dec 1 Prepaid Rent 114 30,000 00
Cash 111 30,000 00
Dec 1 Prepaid Insurance 114 18,000 00
Cash 111 18,000 00
Dec 2 Medical Equipment 118 50,000 00
Accounts payable 211 50,000 00
Dec 3 Accounts payable 112 6,000 00
Cash 111 6,000 00
Dec 5 Salary Expense 212 30,000 00
Cash 111 30,000 00
Dec 6 Office equipment 117 10,000 00
Cash 111 10,000 00
Dec 7 Cash 111 60,000 00
Medical fees 411 60,000 00
Dec 8 Office equipment 117 12,000 00
Accounts payable 211 12,000 00
Dec 10 Accounts Payable 112 4,000 00
Cash 111 4,000 00
Dec 12 Office supplies 117 2,000 00
Cash 111 2,000 00
Dec 14 Accounts Receivables 112 60,000 00
Medical fees 411 60,000 00
Dec 15 Accounts Payable 211 30,000 00
Cash 111 30,000 00
Dec 18 Utilities Exp 513 200 00
Cash 111 200 00
Dec 19 Utilities Exp 513 250 00
Cash 111 250 00
20 Baza’s Drawing 312 10,000 00
Dec
Cash 111 10,000 00
Dec 22 Cash 111 50,000 00
Accounts Receivables 112 50,000 00

Dec 25 Cash 111 80,000 00

Medical fees 411 80,000 00

Dec 26 Medical Supplies 116 20,000 00

Cash 111 20,000 00

Dec 27 Utilities Expense 513 1,500 00

Cash 111 1,500 00
 Dec 28 Miscellaneous Expense 513 500 00

Cash 111 500 00

Dec 29 Medical Supplies 116 80,000 00

Accounts Payable 211 80,000 00

Dec 30 Miscellaneous Expense 517 600 00

Cash 111 600 00

Account Title: Cash 111

Date Item P/R Debit Credit Balance
Dr
2009, Nov 30 Balance Br200,000 00
Dec 1 J1 1200 00 198800 00
Dec 1 J1 30000 00 168800 00
Dec 1 J1 18000 00 150800 00
Dec 3 J1 6000 00 144800 00
Dec 5 J1 30000 00 114800 00
Dec 6 J1 10000 00 104800 00
Dec 7 J1 60000 164800 00
Dec 10 J1 4000 00 160800 00
Dec 12 J1 2000 00 158800 00
Dec 15 J1 30000 00 128800 00
Dec 18 J1 200 00 128600 00
Dec 19 J1 250 00 128350 00
Dec 20 J1 10000 00 118350 00
Dec 22 J1 50000 00 168350 00
Dec 25 J1 80000 00 248350 00
Dec 26 J1 20000 00 228350 00
Dec 27 J1 1500 00 226850 00
Dec 28 J1 500 00 226350 00
Dec 30 J1 600 00 225750 00
 Account Title: Accounts Receivable 112
Date Item P/R Debit Credit Balance
Dr
2009, 30 Balance Br10,000 00
Nov
14 J1 60000 00 70000 00
Dec
22 J1 50000 00 20000 00
Dec

Account Title: Prepaid Rent 113

Date Item P/R Debit Credit Balance
Dr
Dec 1 J1 30000 00 30000 00

Account Title: Prepaid Insurance 114

Date Item P/R Debit Credit Balance
Dr
Dec 1 J1 18000 00 18000 00

Account Title: Office Supplies 115

Date Item P/R Debit Credit Balance
Dr
2009, Nov 30 Balance Br12,000 00
Dec 1 J1 1200 00 13200 00
Dec 12 J1 2000 00 15200 00
Account Title: Medical Supplies 116
Date Item P/R Debit Credit Balance
Dr
2009, Nov 30 Balance Br 18,000 00
Dec 1 J1 10000 00 28000 00
Dec 26 J1 20000 00 48000 00
Dec 29 J1 80000 00 128000 00

Account Title: Office Equipment 117

Date Item P/R Debit Credit Balance
Dr
200, Nov 30 Balance Br120,000 00
Dec 6 J1 10000 00 130000 00
Dec 8 J1 12000 00 142000 00

Account Title: Medical Equipment 118

Date Item P/R Debit Credit Balance
Dr
2009, Nov 30 Balance Br 280,000 00
Dec 2 J1 50000 330000 00
Account Title: Building 119
Date Item P/R Debit Credit Balance
Dr
2009, Nov 30 Balance Br200,000 00

Account Title: Accumulated Deprecation Office equipment 120

Date Item P/R Debit Credit Balance
Cr
2009, Nov 30 Balance Br12,000 00

Account Title: Accumulated Depreciation Medical equipment 121

Date Item P/R Debit Credit Balance
Cr
2009, Nov 30 Balance Br10,000 00

Account Title: Accumulated Depreciation building 122

Date Item P/R Debit Credit Balance
Cr
2009, Nov 30 Balance Br 8,000 00
Account Title: Account Payable 211
Date Item P/R Debit Credit Balance
Cr
2009, Nov 30 Balance Br110,000 00
Dec 1 J1 10000 00 120000 00
Dec 2 J1 50000 00 170000 00
Dec 3 J1 6000 00 164000 00
Dec 8 J1 12000 00 176000 00
Dec 10 J1 4000 00 172000 00
Dec 15 J1 30000 142000 00
Dec 28 J1 80000 00 222000 00

Account Title: Salary payable 212

Date Item P/R Debit Credit Balance
Dr

Account Title: Beza Capital 311

Date Item P/R Debit Credit Balance
Cr
200, Nov 30 Balance Br700,000 00
Account Title: Beza’s Drawing 312
Date Item P/R Debit Credit Balance
Dr
Dec 20 J1 10000 00 10000 00

Account Title: Income Summary 313

Date Item P/R Debit Credit Balance

Account Title: Medical Fees 411

Date Item P/R Debit Credit Balance
Cr
Dec 7 J1 60000 00 60000 00
Dec 14 J1 60000 00 120000 00
Dec 25 J1 80000 00 200000 00

Account Title: Rent Expense 511

Date Item P/R Debit Credit Balance
Dr
Account Title: Salary Expense 512
Date Item P/R Debit Credit Balance
Dr
Dec 5 J1 30000 00 30000 00

Account Title: Utility Expense 513

Date Item P/R Debit Credit Balance
Dr
Dec 18 J1 200 00 200 00
Dec 19 J1 250 00 450 00
Dec 27 J1 1500 00 1950 00

Account Title: Deprecation Expense 514

Date Item P/R Debit Credit Balance
 Dr

Account Title: Supplies Expense 515

Date Item P/R Debit Credit Balance
Dr

Account Title: Insurance Expense 516

Date Item P/R Debit Credit Balance
Dr

Account Title: Misc, Expense 517

Date Item P/R Debit Credit Balance
Dr
Dec. 28 J1 500 00 500 00
Dec. 30 J1 600 00 1100 00
 Beza Clinic
Trial Balance
Dec, 31, 2009
Acct
Account Title Debit Credit
No.
Cash………………………………………………… 111 225,750 00
Accounts Receivable………………………………. 112 20,000 00
Prepaid Rent ………………………………………. 113 30,000 00
Prepaid Insurance …………………………………. 114 18,000 00
Office Supplies…………………………………. 115 15,200 00
Medical Supplies…………………………………… 116 128,000 00
Office Equipment………………………………….. 117 142,000 00
Medical Equipment………………………………… 118 330,000 00
Building……………………………………………. 119 200,000 00
Accumulated Deprecation Medical equipment ……. 120 10,000 00
Accumulated Deprecation Office equipment ……… 121 12,000 00
Accumulated deprecation building ………………. 122 8,000 00
Accounts Payable …………………………………. 211 222,000 00
Salaries payable …………………………………… 212
Beza’s Capital …………………………………… 311 700,000 00
Beza’s Drawing ……………………………………. 312 10,000 00
Income Summary………………………………… 313
Medical Fees……………………………………… 411 200,000 00
Rent Expense……………………………………… 511
Salary Expense……………………………………. 512 30,000 00
Utility Expense ………………………………….. 513 1,950 00
Deprecation Expense ……………………………… 514
Supplies Expense………………………………….. 515
Insurance Expense…………………………………. 516
Misc, Expense ……………………………………. 517 1,100 00
Total 1,152,000 00 1,152,000 00

 Additional Information for Adjustment

1. An office supply on hand as of Dec, 31, 2009 was Br 800. It was determined through physical
count.
2. Medical supplies on hand as of Dec 31, 2009 was Br 600 (Determined by physical counting)
3. Amounts paid for rent and Insurance was for three months.
4. Depreciation expense for the month of December on non-current assets was as follow.
- Depreciation expense on office Equipment ……………… Br 2000
- Depreciation expense on medical Equipment ……………… 2,800
- Depreciation expense on Building ……………………………. 200
5. Accrued salary for the month of Dec ……….. Br. 3000
Required: Based on the above Information
a) Make the necessary adjusting entry
b) Complete the work sheet attached here with
c) Prepare financial statements
I) Income statement
II) Balance sheet
III) Capital statement

Answer for Questions 1 -5

Office supplies……………..15,200
Office supplies on hand…… 800
Office supplied used 14,400

1. Office supplies expense ……………14400

Office Supplies…………………………..14400

Medical supplies……………….128,000
Medical supplies on hand…….…...600
Medical supplies used 127,400

2. Medical supplies expense ……………......127,400

Medical Supplies…………………………127,400
 Prepaid Rent ………30000/3 =Br 10,000

3. Rent expense ……………………………..10,000

Prepaid Rent…………………………………..10,000
 Prepaid Insurance ………..18000/3 =Br 6000
Insurance Expense………………………..6,000
Prepaid Insurance…………………………….6,000

4. Depreciation Expense on office equipment……………2,000

Accumulated Depreciation on office equipment…………..2,000

Depreciation Expense on Medical equipment…………2,800

Accumulated Depreciation on Medical equipment………..2,800
 Depreciation Expense on Building……………………..200
Accumulated Depreciation on Building……………………..200

5. Salary expense ………………….3000

Salary Payable…………………………3000

b) Complete the work sheet

work sheet:-is a multi-column analysis paper used to summarize the changes caused by a
business transaction. Worksheet is not a permanent document.

 Work sheet to be Done in the class.

C) Prepare Financial Statements.

Beza clinic
Income Statement
For the month ended December 31, 2009

Revenue

Medical fee…………………………………………………200, 000

Expenses
Rent expense………………………….10000
Salary expense………………………..33000
Utility expense………………………..1950
Depreciation expense…………………5000
Supplies expense……………………..141800
Insurance expense…………………….6000
Miscellaneous expense………………..1100
Total expense……………………………………………....198,850
Net Income…………………………………………………. 1,150

Beza clinic
Capital Statement
For the month ended December 31, 2009

Beza’s Capital Dec. 1, 2009 …………………………………………………….700, 000.00

Net Income ………………………………………………………………………. 1,150.00

Total 701,150.00

Less Withdrawal for the month Dec 20, 2009…………………………………… 10,000.00

Beza capital Dec.31, 2009………………………………………………………..691,150.00

Beza clinic
Balance sheet
December 31, 2009

Assets
Current Assets
Cash…………………………………………………………….225750
Accounts Receivables…………………………………………..20,000
Prepaid Rent………………………………………….................20,000
Prepaid Insurance……………………………………………….12, 000
Office Supplies……………………………………………………..800
Medical Supplies………………………………………………… 600
Total current assets……………………………………………...279,150
Fixed Assets
Office equipment…………………………142000
Less Acc. Dep. office equipment……………. 14000
128,000
Medical equipment……………………….330000
Less Acc. Dep. Medical equipment……….… 12800
317,200
Building…………………………….…….200000
Less Acc. Dep. Building………………….…. 8200
191,800
Total fixed assets………………………………………………...637000
Total Assets 916,150

Liabilities
Accounts payable …………………………222000
Salary payable………………………………3000
Total liabilities…………………………………………………. 225,000
Capital
Beza capital………………………………………………………….691,150
Total liabilities and capital…………………………………….......916,150