For Periodic Inventory System

2.1. Bdo, a bank lent P 100,000 to a customer on December 1 that

required the customer to pay an annual percentage rate (APR) of
12% on the amount of the loan. The loan is due in six months and
no payment of interest or principal is to be made until the note is
due on May 31. BDO prepares monthly financial statement at the
end of each calendar month. Provide an answer for March only.

2.2. On December 1, AXA Insurance Co. Received P2,400 from

your company for the annual premium covering the twelve-month
period beginning on December 1. AXA Insurance Co. Recorded
the P2,400 receipt as of December 1 with a debit to the current
asset Cash and a credit to the current liability Unearned
Revenues. AXA Insurance Co. Prepares monthly financial
statements at the end of each calendar month. Provide an answer
for April only.

2.3. On December 1, FORTUNE comp[any began operations. On

December 4 it purchased P1,500 of supplies and recorded the
transaction with a debit to the balance sheet account Supplies and
a credit to the current liability accounts payable. FORTUNE
company prepares monthly financial statements at the end of each
calendar month. At the end of the day on December 31,
FORTUNE company estimated the P700 of the supplies were still
on hand in the supply room. The following questions pertain to the
adjusting entry that should be entered by FORTUNE company.

What is the… CASE 2.1 CASE 2.2 CASE 2.3

Date of the 31-Mar 30-Apr 31-Dec

adjusting entry

Debit account Interest Unearned Supplies

title Receivable Revenue Expense

Credit account Interest Revenue Supplies

title Income

Debit and P 1,000 P 200 P 800

Credit amount