FATHER SATURNINO URIOS UNIVERSITY

ACCOUNTANCY PROGRAM

ACC111 – CONCEPTUAL FRAMEWORK & ACCOUNTING STANDARDS

FASAR ACCOUNTING SERVICES

Chart of Accounts

Balance Sheet Accounts Income Statement Accounts

----------------------------------------------------------------------------------------------------------------------------- -----------
Assets Income
Cash 110 Accounting Revenues 410
Accounts Receivable 120 Bookkeeping Revenues 420
Supplies 130
Prepaid Rent 140
Prepaid Insurance 150 Expenses
Service Vehicle 160 Salaries Expense 510
Accumulated Depreciation – SV 170 Supplies Expense 520
Office Equipment 180 Rent expense 530
Accumulated Depreciation- OE 190 Insurance Expense 540
Liabilities Utilities Expense 550
Notes Payable 210 Depreciation Expense – SV 560
Accounts Payable 220 Depreciation Expense – OE 570
Salaries Payable 230 Miscellaneous Expense 580
Utilities Payable 240 Interest Expense 590
Interest Payable 250
Unearned Bookkeeping Revenue 260
Owner’s Equity
Dela Cruz, Capital 310
Dela Cruz, Withdrawals 320

Juan Dela Cruz is a Certified Public Accountant from the Historic City of Butuan. He passed the CPALE last
2016. After working at SGV for almost 2 years, Juan plans to establish his own firm in Butuan City. With the
advice and help of his CPA friends. Juan was convinced to establish his own firm which offers accounting and
bookkeeping services. He registered his business in the name of “FASAR Accounting Services” on May 1,
2018.
The following are the transactions of FASAR Accounting Services for the month of May 2018:

May 1 - Juan Dela Cruz invested P250,000 to FASAR Accounting Services.

- Rented office space and paid two months’ rent in advance, P8,000.
2 - Juan Dela Cruz issued a promissory note for a P210,000 loan from BDO. The note carries a
20% interest per annum. The arrangement with the bank is that both interest and principal
are payable in full in one year.
- Hired an office assistant and accounting clerk each with a P7,930 monthly salary. or, each is
to receive P305 per day for 26-day work month. They started work immediately.
4 - Acquired Service Vehicle for P320,000.
- Paid Sun Life Insurance Inc., P14,400 for a one year comprehensive insurance coverage of
the Service Vehicle.
5 - Acquired Computer and Printer from Midtown Suplies for 60,000; paying P20,000 in cash

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 and the balance next month.
8 - Purchased supplies on credit for P18,000 from Sungold Supplies.
9 - Paid Sungold Supplies P10,000 of the amount owed.
10 - Rendered Accounting Services to three clients and collected P5,000 per client.
13 - Paid Salaries, P6,710. The firm pays salaries every two Saturdays.
15 - Received P9,000 advance bookkeeping retainers fee from the three clients (P3,000 each).
19 - Billed ten new client for the Accounting Services Rendered, P5,000 each client.
25 - Juan Dela Cruz withdrew 15,000 for personal expenses.
27 - Paid Salaries, P7,320.
30 - Received telephone bill from PLDT, P1,400
- Received P30,000 from six clients for services billed last May 19.
31 - Settled electricity bill of P3,000 for the month.

The following information are also available at the end of May 2018 (adjustments).
a. Half of the rent paid in advance had already expired.
b. A review of Insurance Policies showed that P13,200 is unexpired at the month end.
c. JJ makes a physical supplies count at the end of May 2018, the supply count showed that supplies costing
P15,000 are still on hand.
d. The Service Vehicle has an estimated useful life of 7 years and with a salvage value of P68,000. As matter of
company policy, the period May 4 to 30 is considered a month.
e. The Office Equipment has an estimated useful life of 5 years and will be worthless at that time. As matter of
company policy, the period May 5 to 30 is considered a month.
f. Bookkeeping retainers fee paid in advance by one client is already earned, P3,000.
g. The office assistant and accounting clerk were paid salaries on May 13 and 27. At month end, the employees
have worked for three days (may 29, 30, 31) beyond the last day period.
h. Interest from the Notes Payable has been accrued for the month of May. As a matter of company policy, the
period May 2 to 30 is considered a month.
i. In the afternoon of May 31, 2018, one client rushed to GEL Accounting Services to seek some accounting
services. The entity intended to charge fees of P5,000 for the services, which is earned but not yet collected.

Required: (STRICTLY NO ERASURES)

Step 1: Analyze the source documents (transactions).
Step 2: Journalize the transactions in your Journal Book.
Step 3: Post your entries to the Ledger by preparing T-Accounts. Use your Journal as your Ledger. One T-
Account per page.
Step 4: Prepare an Unadjusted Trial Balance in your Journal Book. Then use this information as your starting
point for your worksheet.
Step 5: Prepare adjusting entries in your Journal book and post to each account to its respective ledger. Post
the amount to your worksheet. Then, complete your worksheet ( Adjusted Trial Balance, Income Statement &
Statement of Financial Position).
Step 6: Prepare an Income Statement, Statement of Changes in Owner’s Equity and Statement of Financial
Position using your journal book.

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