BUSINESS FINANCE

ABM12 - HARMONY

Name: _________________________________________ Date: _______________ Score: __________

ACTIVITY # 2

Arnina established a service business to be known as Arnina Photography on July 1, 2015. During the
first month, the following transactions occurred:

1. July 1: Arnina transferred cash of P 300,000 from her personal bank to an account to be used for
her business. She also invested the following: digital camera, P45,000; manual camera, p25,000;
desktop computer, P28,000; photopapers and ink, P14,000; and her personal debts evidenced by a
note which would be assumed by the business, P12,000
2. July 4: Paid six month advance rent to Cyrene Commercial Complex P 30,000
3. July 6: Received a statement of account from Brian News for advertising this month, P5,500
4. July 8: Bought photo enhancing and editing equipment from Mirzi Outlet for P40,000. Arnina paid
30% downpayment and the balance on account.
5. July 12: Hired office assistant with a monthly salary of P6,000. The office assistant officially started
on July 16, 2014.
6. July 13: Photography services rendered totaled P 180,000. Terms; 25% cash and the balance settled
on account.
7. July 14: Purchased office sala set from Renzo Designs for P30,000 on account.
8. July 15:Paid various operating expenses during the month: Meeting potential clients,
P4,0000;electricity, P23,000; telephone expense, P6,0000; and repairs expense, P2,500
9. July 18: Photography services rendered totaled P 180,000 of which 25% was settled with an
interest-bearing note and the balance on account.
10. July 20: Received photography advances from a couple for a prenuptial coverage to be rendered
next month, P60,0000
11. July 22: Collected 90% of the outstanding receivable from July 13 transaction
12. July 24: Paid in full the statement of account received last July 6
13. July 26: Paid 80% of the outstanding obligation to Mirzi outlet and for the remaining balance, she
issued an interest- bearing note.
14. July 28: Paid half of the outstanding obligation to Renzo Designs.
15. July 31: Paid salary of the office assistant for 16 days.

Requirement:
 Jornalize the foregoing transactions
 Post the transactions
 Prepare trial balance
 Activity # 3

The following accounts were taken from the adjusted trial balance of Alvaro Printing Press, a calendar
year business, as of December 31, 2015 ( disregarding effect of income taxes)

Debit Credit
Accounts Payable P 35, 000
Accounts Receivable P 82,000
Accumulated Depreciation - Furniture and Fixtures 1,000
Accumulated Depreciation - Office Equipment 2,250
Accumulated Depreciation - Pressing Machine 6,250
Accumulated Depreciation - Printing Machine 10,000
Allowance for Doubtful Accounts 5,000
Alvaro, Capital ?
Alvaro, Drawing 30,000
Cash 120,000
Depreciation Expense 19,500
Doubtful Accounts Expense 5,000
Furniture and Fixtures 10,000
Insurance Expense 12,000
Interest Expense 3,600
Interest income 18,000
Interest Receivable 18,000
Interest Payable 3,600
Investment in trading securities 70,000
Mortgage Payable 15,000
Notes Payable - due in two years 30,000
Notes Receivable - due in 6 months 150,000
Office Equipment 20,000
Office Supplies 8,000
Pressing Machine 40,500
Printing Machine 55,000
Printing Revenue 580,000
Printing Supplies 25,000
Rent Expense 48,000
Salaries Expense 260,000
Salaries Payable 10,000
Supplies Expense 12,000
Utilities Expense 27,500
Totals P 1,016,100 P 1,016,100

Prepare the following:

 Income Statement - natural form
 Statement of Changes in Owner’s Equity
 Statement of Financial Position - Report Form ; and
 Notes to Financial statement