Initial Investment (Source of Assets)

May 1 Virginia Yacapin is a cultured women from the South. She is

into a lot of interesting causes. Her fine taste is preeminent
such that she is considered an authority in planning
weddings. Upon the advice of a trusted associate, Marivic
Babaran, Yacapin decide to organize her wedding
consultancy. She invested P250,000 into this entity.

Rent Paid in Advance (Exchange of Assets)

May 1 Rented office space and paid two months’ rent in advance,
P8,000.

Note Issued for Cash (Source of Assets)

May 2 Virginia Yacapin issued a promissory note for a P210,000

loan from Metrobank. This availment will be used for the
acquisition of a service vehicle. This note carries a 20%
interest per annum. The arrangement with the bank is that
both the interest and the principal are payable in full in one
year.

May 2 Hired an office assistant and an account executive each with

a P7,800 monthly salary. Or, each is to receive P300 per day
for the 26-Day work month. No entry is necessary at this
point. They started work immediately.

Service Vehicle Acquired for Cash (Exchange of Assets)

May 4 Acquired service vehicle for P420,000.

Insurance Premiums Paid (Exchange of Assets)

May 4 Paid Prudential Guarantee and Assurance, Inc. P14,400 for a

one-year comprehensive insurance coverage on the service
vehicle.
Office Equipment Acquired on Account (Exchange and Source of Assets)

May 5 Acquired office equipment from Fair and Square Emporium

for P60,000; paying P15,000 in cash and the balance next
month. Note: A compound entry is needed for this
transaction.

Supplies Purchased on Account (Source of Assets)

May 8 Purchased supplies on credit for P18,000 from San Jose

Merchandising.

Accounts Payable Partially Settled (Use of Assets)

May 9 Paid San Jose Merchandising P10,000 of the amount owed.

Revenues Earned and Cash Collected (Source of Assets)

May 10 Coordinated and finalized simple bridal arrangements for

three couples and collected fess of P8,800 per couple.
Services include prospecting and selecting the church and
reception location, couturier, caterer, car service, flowers,
souvenirs and invitation.

Salaries Paid (Use of Assets)

May 13 Paid salaries, P6,600. This entity pays salaries every two
Saturdays (refer to the calendar in Chapter 5).

Unearned Revenues Collected (Source of Assets)

May 15 The entity is earning additional revenues by referring

consulting clients to friendly hotels, caterers, printers, and
P10,000 advance fees for three clients referred.
Revenues Earned on Account (Source of Assets)

May 19 Coordinated and finalized elaborate bridal arrangements

for three couples and billed fess of P12,000 per couple.
Additional services include documents preparation,
consultation with a feng shui expert as to the ideal wedding
date for prosperity and harmony, provision for limousine
service and honeymoon trip.

Withdrawal of Cash y Owner (Use of Assets)

May 25 Yacapin withdrew P14,000 per personal expenses.

Salaries Paid (Use of Assets)

May 27 Paid salaries, P7,200.

Expenses Incurred but Unpaid (Exchange of Assets)

May 30 Received the ICC-BayanTel telephone bill, P1,400.

Accounts Receivable Partially Collected (Exchange of Assets)

May 30 Received P24,000 from two clients for services billed last
May 19.

Expenses Incurred and Paid (Use of Assets)

May 31 Settled the electricity bill of P3,000 for the month.