LESSON 6.

1
SEATWORK 1

12 ABM -
OJERA, Emmanuel
REYES, Aaron James
SULIT, Joseph Emmanuel
DIONISIO, Alexa

If you are an accountant of Florendo H304 and Associates, the biggest accounting firm
in Brgy. Maginhawa, Quezon City. Your client asked you the following questions and
requires an immediate response. Construct a three-sentence reply that will satisfy the
curiosity of your client.

1. I think preparing a trial balance is just a waste of time. If I have computerized

journalizing and posting systems, is there really a need for me to prepare a trial
balance?

Answer: A trial balance is not a waste of time even if you have computerized
journalizing and posting systems there is a need to prepare a trial balance.
Because trial balance is crucial, it ensures that what we make is correct. It serves
as a foundation against misrecording and helps us avoid mistakes in our
recordings. It is an accounting cycle and proves the accuracy of an accounting
identity. When we add the debits and credits for each journal entry, the total
should be equal, indicating that your balance is correct.

Answered by: Sulit, Joseph Emmanuel F.

2. My friend's accountant refuses to enter his purchase of his silver watch in the
books of his proprietorship. Why can it not be done if my friend is the sole
proprietor of the business and he raised it with his money alone?

Answer: You can’t put purchase a silver watch because it is a personal

purchase. You can only put business expenses in the books of accounts. Even if
it is a sole proprietorship, You should know how to separate your own business
transactions from your own personal transactions hence making it not a relevant
entry to put in. Another reason is its impact on the business as a whole, That
personal purchase does not have any major significance to the business so if you
did add it, It will make your book of entries confusing.

Answered by: Ojera, Emmanuel S.

3. What is the difference between a sales invoice and a receipt?

Answer: Prior to the completion of the purchase of the products or services but
just before paying the amount, the seller will issue an invoice as a request for
payment. Usually provide details regarding the transaction, like the mode of
payment, the date the invoice was given, and also the total price payable. On the
other hand, when clients pay for products or services, a receipt is given to them
as confirmation of the transaction. Receipts frequently contain details of the items
or products that were purchased, such as quantity, cost, and any discounts, and
they may also indicate the mode of payment that was used for the transaction.

Answered by: Dionisio, Alexa

4. I inspected the journals earlier today and I saw suspecting entries. Imagine, there
were three debits in one journal entry and only one credit! I checked the trial
balance and it balanced. How can that be? What fraud!

Answer: When you write journal entries, you will need to have at least one debit
and one credit. However, it does not mean it is required to have only one debit or
credit; there are possibilities where you can have more debit or even more credit.
It depends on the account title from the transaction that has happened in your
company, and once the three debits and one credit are recorded in your journal
in your situation, it is destined to be balanced because the debits equal the credit
in the journal.

Answered by: Reyes, Aaron

5. I am thinking of eliminating the journalizing part of my manual accounting system

altogether; I believe it is a huge waste of time and resources. I will Just go from
identification, analysis, and measurement and straight to posting. Can you give
me some advice?

Answer: You should keep journalizing as a part of your accounting system,

Journalizing is not a process you can just skip. It helps you Identify where the
entries should go and differentiate them as asset, liability, or equity. Another key
point is you can track the date of each entry, therefore, gathering them in an
organized manner. In short, Books or journals are an organized way of listing
transactions. It helps others to easily understand when and what economic
events happened during the span of a month or a year.

Answered by: Ojera, Emmanuel