BUSINESS TRANSACTIONS

CHART OF ACCOUNTS
No. Account Title No. Account Title Mr. Storm opened
ASSETS REVENUES The following transactions

101 Cash 400 Laundry Revenue 1-Dec

102 Account Receivable
103 Allowance for Doubtful Account
104 Note Receivable 8-Dec
105 Laundry Supplies
106 Office Supplies
107 Laundry Equipment 10-Dec
108 Accumulated Depreciation - Laundry
Equipment

109 Furniture and Fixtures 12-Dec

110 Accumulated Depreciation -
Furniture and Fixtires

111 Delivery Vehicle 14-Dec

LIABILITIES EXPENSES
201 Accounts Payable 500 Utilities Expense 15-Dec
202 Notes payable 501 Laundry Supplies Expense
203 Unearned Revenue 502 Office Supplies Expense
204 Salaries payable 503 Salary Expense 16-Dec
205 Loan Payable 504 Rent Expense
505 Repairs Expense
OWNER'S EQUITY 506 Telephone Expense 18-Dec
300 S. Capital 507 Interest Expense
301 S.Withdrawal 508 Depreciation Expense
Doubtful Account Expense 20-Dec

22-Dec

25-Dec

26-Dec

27-Dec

28-Dec
30-Dec
BUSINESS TRANSACTIONS

Mr. Storm opened his new business by which he named Storm Laundry Services.
The following transactions took place for the month of September 2020.

Storm invested P 120,000 cash to start a laundry business. He also added Laundry equipment worth P 35,000;
Furniture and Fixtures P 22,500; Office Supplies P 4,200; and Laundry Supplies P 5,000.

Bought dryers and spinners from Caleb Outlet for P 40,000. Storm paid 30% down payment and the balance on
account.

Laundry services rendered totaled P 195,000, of which 40% is on account and the remaining is cash.

Received proceeds of bank loan P 220,000 from a bank loan for business use. Storm will use this to purchase a
van for pick-up and delivery of laundry from clients.

Purchased a delivery van from Jason Motors for P 5,250,000. Storm used the entire proceeds from the bank loan
to pay for the delivery van and the balance by issuing a 5% note payable maturing in 12 months for the balance P
5,030,000.

Paid various operating expenses during the month: Water and electricity, P 28,000; Telephone expense P 6,000;
and Repairs Expense P 3,500.

Laundry services rendered totaled P 180,000 of which 30% was settled with a note and the balance on account.

Received laundry advances from Pontefino Hotel for services to be rendered next month, P 90,000.

Collected 90% of the accounting receivable from September 10 transaction.

Purchased detergents and fabric conditioners from Ivory Cleaning Scents, P 12,000. Paid P 8,000 cash and the
balance on account.

Returned P 2,000 worth of damaged detergents and fabric conditioners bought last Dec 22.

Paid salary of two staff P 20,000

Withdrew P 15,000 for personal use

Received P 70,000 cash for laundry services rendered

Paid accounts from Dec 22 transaction P 1,000
 t worth P 35,000;

and the balance on

is cash.

this to purchase a

s from the bank loan

ths for the balance P

ne expense P 6,000;

balance on account.

90,000.

000 cash and the

DATE ACCOUNT TITLES DEBIT CREDIT

Dec 1 Cash 120000.00

Laundry Equipment 35000.00
Furniture and Fixtures 22500.00
Office Supplies 4200.00
Laundry Supplies 5000.00
S. Capital 186700.00

Dec 8 Laundry Equipment 40000.00

Cash 12000.00
Accounts Payable 28000.00

Dec 10 Accounts Receivable 78000.00

Cash 117000.00
Laundry Revenue 195000.00

Dec 12 Cash 220000.00

Loan Payable 220000.00

Dec 14 Delivery Vehicle 5250000.00

Cash 220000.00
Notes Payable 5030000.00

Dec 15 Utilities Expense 28000.00

Telephone Expense 6000.00
Repairs Expense 3500.00
Cash 37500.00

Dec 16 Notes Receivable 54000.00

Accounts Receivable 126000.00
Laundry Revenue 180000.00
Dec 18 Cash 90000.00
Unearned Revenue 90000.00

Dec 20 Cash 70200.00

Accounts Receivable 70200.00

Dec 22 Laundry Supplies 12000.00

Cash 8000.00
Accounts Payable 4000.00

Dec 25 Accounts Payable 2000.00

Laundry Supplies 2000.00

Dec 26 Salary Expense 20000.00

Cash 20000.00

Dec 27 S. Withdrawal 15000.00

Cash 15000.00

Dec 28 Cash 70000.00

Laundry Revenue 70000.00

Dec 30 Accounts Payable 1000.00

Cash 1000.00
ASSETS LIABILITIES OWNER'S EQUITY

CASH ACCOUNTS PAYABLE S. CAPITAL

120000.00 12000.00 1000.00 28000.00
117000.00 220000.00 2000.00 4000.00
220000.00 37500.00 3000.00 32000.00
90000.00 8000.00 29000.00
70200.00 20000.00
70000.00 15000.00
1000.00
687200.00 313500.00
373700.00

ACCOUNT RECEIVABLE NOTES PAYABLE S. WITHDRAWAL

78000.00 70200.00 5030000.00 15000.00
126000.00
204000.00 70200.00
133800.00

NOTE RECEIVABLE UNEARNED REVENUE LAUNDRY REVENUE

54000.00 90000.00

LAUNDY SUPPLIES LOAN PAYABLE UTILITIES EXPENSE

5000.00 2000.00 220000.00 28000.00
12000.00
17000.00
15000.00
 OFFICE SUPPLIES SALARY EXPENSE
4200.00 20000.00

LAUNDRY EQUIPMENT TELEPHONE EXPENSE

35000.00 6000.00
40000.00
75000.00

DELIVERY VEHICLE REPAIRS EXPENSE

5250000.00 3500.00

FURNITURE AND FIXTURES

22500.00
 S. CAPITAL
186700.00

S. WITHDRAWAL

LAUNDRY REVENUE
195000.00
180000.00
70000.00
445000.00

UTILITIES EXPENSE
 SALARY EXPENSE

TELEPHONE EXPENSE

REPAIRS EXPENSE
 STORM LAUNDRY SERVICES
UNADJUSTED TRIAL BALANCE
DECEMBER 30, 2020

DEBIT CREDIT
Cash 373,700.00
Account Receivable 133,800.00
Note Receivable 54,000.00
Laundry Supplies 15,000.00
Office Supplies 4,200.00
Laundry Equipment 75,000.00
Delivery Vehicle 5,250,000.00
Furniture and Fixtures 22,500.00
Accounts Payable 29,000.00
Notes Payable 5,030,000.00
Unearned Revenue 90,000.00
Loan Payable 220,000.00
S. Capital 186,700.00
S. Withdrawal 15,000.00
Laundry Revenue 445,000.00
Utilities Expense 28,000.00
Salary Expense 20,000.00
Telephone Expense 6,000.00
Repairs Expense 3,500.00

6,000,700.00 6,000,700.00
 Prepare and complete the worksheet using the following information
At the end of the month, the following transactions need to be adjusted.
a. Laundry Supplies on hand amounted to P 4,200
b. Office supplies on hand amounted to P 1,500
c. Salaries of P 5,000 have accrued at month-end
d. Depreciation of the laundry equipment for the month is P 1,250
e. Interest on the 5% notes amounted to P 20,960.00
f 1% of the total Accounts Receivable is assumed to be doubtful account.
Laundry Supplies Expense 10800.00
Laundry Supplies 10800.00

Office Supplies Expense 2700.00

Office Supplies 2700.00

Salaries Expense 5000.00

Salaries Payable 5000.00

Depreciation Expense 1250.00

Accumulated Depreciation- Laundry Equipment 1250.00

Interest Expense 20960.00

Interest Payable 20960.00

Doubtful Account Expense 1338.00

Allowance for Doubtful Account 1338.00
STORM LAUNDRY SERVICES
DECEMBER 31,2020

UNADJUSTED TRIAL BALANCE ADJUSTMENTS ADJUSTED TRIAL BALANCE

accounts dr cr dr cr dr
Cash 373700.00 373700.00
Account Receivable 133800.00 133800.00
Allowance for Doubtfull Accounts 1338.00
Note Receivable 54000.00 54000.00
Laundry Supplies 15000.00 10800.00 4200.00
Office Supplies 4200.00 2700.00 1500.00
Laundry Equipment 75000.00 75000.00
Accumulated Depreciaiton 1250.00
Delivery Vehicle 5250000.00 5250000.00
Furniture and Fixtures 22500.00 22500.00
Accounts Payable 29000.00
Salaries Payable 5000.00
Interest Payable 20960.00
Notes Payable 5030000.00
Unearned Revenue 90000.00
Loan Payable 220000.00
S. Capital 186700.00
S. Withdrawal 15000.00 15000.00
Laundry Revenue 445000.00
Utilities Expense 28000.00 28000.00
Salary Expense 20000.00 5000.00 25000.00
Telephone Expense 6000.00 6000.00
Repairs Expense 3500.00 3500.00
Laundry Supplies Expense 10800.00 10800.00
Office Supplies Expense 2700.00 2700.00
Doubtful Account Expense 1338.00 1338.00
Depreciation Expense 1250.00 1250.00
Interest Expense 20960.00 20960.00

6000700.00 6000700.00 42048.00 40710.00 6029248.00

USTED TRIAL BALANCE
cr

1338.00

1250.00

29000.00
5000.00
20960.00
5030000.00
90000.00
220000.00
186700.00

445000.00
6027910.00
 STORM LAUNDRY SERVICES STORM LAUNDRY SERVICES
INCOME STATEMENT STATEMENT OF CHANGES IN OWNER'S EQUITY
FOR THE YEAR ENDED DECEMBER 31,2020 FOR THE YEAR ENDED DECEMBER 31,2020

REVENUES STORM CAPITAL BEGINNING 186700.00

Laundry Revenue 445000.00 ADD: NET INCOME 345452.00
LESS: OPERATING EXPENSES ADDITIONAL INVESTMENT
Utilities Expense 28000.00 TOTAL 532152.00
Salary Expense 25000.00 LESS: STORM WITHDRAWAL 15000.00
Telephone Expense 6000.00 STORM CAPITAL ENDING 517152.00
Repairs Expense 3500.00
Laundry Supplies Expense 10800.00
Office Supplies Expense 2700.00
Doubtful Account Expense 1338.00
Depreciation Expense 1250.00
Interest Expense 20960.00 99548.00
NET INCOME 345452.00
ES STORM LAUNDRY SERVICES
STATEMENT OF FINANCIAL POSITION
31,2020 AS OF DECEMBER 31,2020

ASSETS
CURRENT ASSETS NONCURRENT ASSETS
Cash 373700.00 Delivery Vehicle 5250000.00
Account Receivable 132462.00 Laundry Equipment 73750.00
Note Receivable 54000.00 Furniture and Fixtures 22500.00
Laundry Supplies 4200.00 TOTAL NONCURRENT ASSETS 5346250.00
Office Supplies 1500.00
TOTAL CURRENT ASSETS 565862.00
TOTAL NONCURRENT ASSETS 5346250.00
TOTAL ASSETS 5912112.00

LIABILITIES AND OWNER'S EQUITY

CURRENT LIABILITIES NONCURRENT LIABILITIES
Accounts Payable 29000.00 Loan Payable 220000.00
Notes Payable 5030000.00 TOTAL NONCURRENT LIABILITIES 220000.00
Unearned Revenue 90000.00
Salaries Payable 5000.00
Interest Payable 20960.00
TOTAL CURRENT LIABILITIES 5174960.00
TOTAL NONCURRENT LIABILITIES 220000.00
TOTAL LIABILITIES 5394960.00
OWNER'S EQUITY 517152.00
TOTAL LIABILITIES AND OWNER'S EQUI 5912112.00
 JOURNAL ENTRIES

December 30, 2020

1 Laundry Revenue 445000.00

Storm Capital 445000.00

2 Storm Capital 99548.00

Utilities Expense 28000.00
Salary Expense 25000.00
Telephone Expense 6000.00
Repairs Expense 3500.00
Laundry Supplies Expense 10800.00
Office Supplies Expense 2700.00
Doubtful Account Expense 1338.00
Depreciation Expense 1250.00
Interest Expense 20960.00

3 Storm Capital 15000.00

Storm Withdrawal 15000.00
 STORM LAUNDRY SERVICES
POST-CLOSING TRIAL BALANCE
JANUARY 1, 2021

ACCOUNT TITLE DR CR
Cash 373700.00
Account Receivable 133800.00
Allowance for Doubtfull Accounts 1338.00
Note Receivable 54000.00
Laundry Supplies 4200.00
Office Supplies 1500.00
Laundry Equipment 75000.00
Accumulated Depreciaiton 1250.00
Delivery Vehicle 5250000.00
Furniture and Fixtures 22500.00
Accounts Payable 29000.00
Salaries Payable 5000.00
Interest Payable 20960.00
Notes Payable 5030000.00
Unearned Revenue 90000.00
Loan Payable 220000.00
S. Capital 517152.00
5914700.00 5914700.00