Exercise 1.

Worksheet

Donald Electronics an electronics repair shop, prepared the unadjusted trial balance at the end of its first year of operations shown below:

Donald Electronics
Trial Balance
April 30, 2019

Cash P 3,450
Accounts Receivable 22,500
Supplies 5,400
Equipment 113,700
Accounts Payable P 5,250
Unearned Fees 6,000
Hans Donald, Capital 78,000
Hans Donald, Drawings 4,500
Fees earned 135,750
Salaries Expense 31,500
Rent Expense 24,000
Utilities Expense 17,250
Miscellaneous Expense 2,700
P 225,000 P 225,000

For preparing the adjusting entries, the following data were assembled:
a. Fees earned but unbilled on April 30 were P1,775.
b. Supplies on hand on April 30 were P1,200.
c. Depreciation of equipment was estimated to be P4,100 for the year.
d. The balance in unearned fees represented the April 1 receipt in advance for services to be provided. Only P1,750 of the services was provided between April 1 and April 30.
e. Unpaid wages accrued on April 30 were P600.

Required:
1. Prepare the adjusting entries necessary on April 30, 2019.
2. Prepare a Ten-Column Worksheet.

Answers :
1. Prepare the adjusting entries necessary on April 30, 2019.

a.

April 30, 2019 Account Receivable P 1, 775

Fees earned P 1, 775

b.

April 30, 2019 Supplies Expense P 4,200

Supplies P 4, 200

c.

April 30, 2019 Depreciation Expense of equipment P 4,100

Accumulated Depreciation of Equipment P 4,100

d.

April 30, 2019 Unearned Fees P 1, 750

Fees earned P 1, 750

e.

April 30, 2019 Wages Expense P 600

Wages Payable P 600

 2.

Account Title Trial Balance Adjustment Adjustment Trial Income Statement Balance Sheet

Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.

Cash P 3, 450 - P 3, 450 P 3, 450

Account Receivable 22,500 P 1, 775 24, 275 24, 275

Supplies 5, 400 P 4, 200 1, 200 1, 200

Equipment 113, 700 113, 700 113, 700

Account Payable P 5, 250 P 5, 250 P 5, 250

Unearned Fees 6, 000 1, 750 4, 250 4, 250

Hans Donald, Capital 78, 000 78, 000 78, 000

Hans Donald, Drawings 4 , 500 4, 500 4, 500

Fees earned 135 , 750 1, 775 + 139, 275 P 139, 275

1750 =
3, 525

Salaries Expense 31, 500 31, 500 P 31, 500

Rent Expense 24, 000 24, 000 24, 000

Utilities Expense 17, 250 17, 250 17, 250

Miscellaneous Expense 2, 700 2, 700 2, 700

Total 225, 000 225,000

b. Supplies Expense 4, 200 4, 200 4, 200

c. . Depreciation Expense 4,100 4,100 4, 100
of equipment

c. Accumulated 4,100 4, 100 4, 100

Depreciation of equip

e . Wages Expense 600 600 600

g . Wages Payable 600 600 600

Total P 12, 425 p 12, 425 P 231, 475 P 231, 475 P 84, 350 P 143, 975 P 147, 125 P 87, 500

Net Income 59, 625 59, 625

P 143, 975 P 143, 975 P 147, 125 P 147, 125