Republic of the Philippines

Department of Education
REGION III
Schools Division Office of Gapan City
Maruhat National High School

Fundamentals of Accountancy, Business and Management 1 Week 2 Module 1

Activity 1: Identification. Tell whether the following accounts fall under income statement or
balance sheet.

1. Rent income
2. Rent expense
3. Unearned rent
4. Rent receivable
5. Interest income
6. Unearned interest
7. Prepaid insurance
8. Interest receivable
9. Insurance expense
10.Accounts receivable

Activity 2: True or False

1. Income and expenses fall under the income statement.

2. The financial statements are the end product of the accounting process.
3. In the income statement, there is profit if the total debits exceed total credits.
4. The format for the date/period in the heading of the income statement is written as
follows “As of Month Date, Year”.
5. The Statement of Comprehensive Income is considered the bridge between the Statement
of Changes in Owner’s Equity and the Statement of Financial Position.

Activity 3: Essay. Read and analyze the following question.

Rubrics: Content – 3 points Organization of ideas – 2 points

1. What is the importance of preparing the financial statements?

2. How are income statement, changes in equity, and balance sheet connected to one
another?
Performance Task 1:

Consider the Unadjusted Trial Balance and the adjusting transactions for this activity. Prepare
the following for the period ended December 31, 2022.

a) Income Statement (Worksheet)

b) Balance Sheet (Worksheet)
c) Statement of Comprehensive Income
d) Statement of Changes in Owner’s Equity
e) Statement of Financial Position

FABM 1 Services
December 31, 2022
Unadjusted Adjustments Adjusted
Accounts
Debit Credit Debit Credit Debit Credit
Cash ₱162,000   ₱162,000  
Accounts receivable 5,000   5,000  
Equipment 12,000   12,000  
Notes payable   ₱100,000   ₱100,000
Owner’s capital   38,000   38,000
Owner’s drawing 2,000   2,000  
Service income   70,000 ₱ 10,000   60,000
Rent income   18,000 ₱ 6,000   24,000
Utilities expense 21,000   21,000  
Insurance expense 24,000   6,000 18,000  
Totals ₱226,000 ₱226,000
Rent receivable 6,000 6,000
Interest expense 5,000 5,000
Interest payable 5,000 5,000
Depreciation expense 3,000 3,000
Accumulated
3,000 3,000
depreciation
Bad debts expense 1,000 1,000
Allowance for bad debts 1,000 1,000
Prepaid insurance 6,000 6,000
Unearned service income 10,000 10,000
Totals ₱ 31,000 ₱ 31,000 ₱ 241,000 ₱ 241,000