Pedro Santos’ Transportation Business

General Journal
For the Month of July
Date Account name and description Dr Cr
July Cash P400,00
1 0
Pedro Santos, Capital P400,0
00
To record the investment of Pedro Santos

July Transportation Equipment P160,00

2 0
Accounts Payable P160,0
00
To record the purchase of transportation
equipment (2 jeeps) from Thames Inc. on
credit

July Cash P30,000

3
Service Income P30,00
0
To record the received passenger fares.

July Furniture and Fixtures P24,000

4
Accounts Payable P24,00
0
To record the purchased tables and chairs
from Nicfur Co. on credit.

July Salaries Expense P12,000

5
Cash P12,00
0

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 To record the payment of the salaries

July Cash P4,000

6
Pedro Santos, Capital P4,000
To record the additional cash placed in
the business.

July Accounts Payable P16,000

7
Cash P16,00
0
To record payment to Nicfur Co.

July Rent Expense P2,400

8
Cash P2,400
To record the payment of rental.

July Pedro Santos, Withdrawal P14,000

9
Cash P14,00
0
To record owner’s withdrawal for personal
use.

Total: P662,40 P662,4

0 00

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 Pedro Santos’ Transportation Business
General Ledger

ASSETS

Cash Transporta9on Equipment

Dr Cr Dr Cr
P400,000 P12,000 P160,000
P30,000 P16,000
P4,000 P14,000
P2,400

P434,000 P44,400

Total: P389,600 Total: P160,000

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 Furniture and Fixtures
Dr Cr
P24,000

Total: P24,000

LIABILITIES
Accounts Payable
Dr Cr
P16,000 P160,000
P24,000

P184,000

Total: P168,000

OWNER’S EQUITY
Pedro Santos, Capital Service Income
Dr Cr Dr Cr
P400,000 P30,000
P4,000

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Total: P404,000 Total: P30,000

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 Rent Expense
Salaries Expense
Dr Cr
Dr Cr
P2,400
P12,000

Total: P2,400
Total: P12,000

Pedro Santos, Withdrawal

Dr Cr
P14,000

Total: P14,000

Pedro Santos’ Transportation Business

Income Statement
For the month of July

Service Income P30,000

Less: Salaries Expense P12,000

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 Less: Rent Expense P2.400

Net ProOt: P15,600

Pedro Santos’ Transportation Business

Balance Sheet

Assets Liabili9es and Owner’s Equity

Cash P389,600

Transporta9on Equipment P160,000 Liabili9es

Furnitures and Fixtures P24,000 Accounts Payable P168,000

Total Assets: P573,600 Total Liabili9es: P168,000

Owner’s Equity
Pedro Santos, Capital P404,000

Salaries Expense (P12,000)

Rent Expense (P2,400)

Service Income P30,000

Pedro Santos, Withdrawal P14,000

Total Owner’s Equity: P433,600

TOTAL LIABILITIES AND OWNER’S

EQUITY: P601,600

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 Instruc=ons: Record the following transac=ons following the illustra=on of an Accoun=ng Equa=on
(Assets = Liabili=es + Capital).

1. On July 1, Pedro Santos engaged in a transporta=on business with a cash capital investment of P
400,000.

2. Mr. Santos bought two second hand converted (2) jeeps from Thames Inc. for P160,000 on credit.

3. Received cash from passenger fares P30,000.

4. Bought tables and chairs for oUce use from Nicfur Co. P24,000 on credit.

5. Paid in cash the salaries of drivers and other employees in the amount of P 12,000.

6. Mr. Santos placed in the business addi=onal cash of P4,000.

7. Paid in cash P16,000 to Nicfur Co. in par=al payment of the amount due.

8. Rent is paid in cash, P2,400

9. Mr. Santos takes from the business fund P14,000 for his family expenses.

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