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Peer Tutorial Exercise 1

The document outlines a series of financial transactions for Lia's service business, including initial investments, loans, service revenues, and various expenses throughout the months of January to December. Key transactions include cash investments, equipment purchases, service rendered on account, and loans taken from banks. Additionally, it details payments for salaries, office supplies, rent, advertising, and travel costs, along with client payments and promissory notes received.

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fredricambroisegarcela50
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46 views2 pages

Peer Tutorial Exercise 1

The document outlines a series of financial transactions for Lia's service business, including initial investments, loans, service revenues, and various expenses throughout the months of January to December. Key transactions include cash investments, equipment purchases, service rendered on account, and loans taken from banks. Additionally, it details payments for salaries, office supplies, rent, advertising, and travel costs, along with client payments and promissory notes received.

Uploaded by

fredricambroisegarcela50
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Prepare the journal entries for the following transactions

Jan 01 Lia decided to enter into a service business as a sole proprietor and invest
cash amounting to P200,000 and an equipment costing P350,000. The
equipment has a useful life of 7 years with no salvage value.
Jan 05 Borrowed an amount money from Landbank amounting to ₱400,000. The
principal of the loan was to be paid after 3 years.
Jan 17 The entity rendered a service on account to B amounting to P50,000.
Jan 28 Purchased office supplies worth P46,000.
Jan 31 Paid salaries to employees amounting to P20,000. The company has a policy
to pay its employees every end of the month.
Feb 03 The entity received an advance payment of P28,000 for services to be
rendered on March 15.
Feb 28 Received a promissory note from B for his account amounting to P28,000, and
the remaining balance was settled.
Mar 08 Billed clients for services rendered, ₱ 110,000.
Mar 24 Purchased office furniture on account from ABC Trading for ₱200,000.
Apr 16 Lia made a cash withdrawal of ₱15,000 and office supplies worth P12,000.
May 05 Rendered services to a client amounting to P 152,600. The company received
cash amounting to 40% of the amount, the client issued a note for 30% of the
remaining amount and the rest was on account.
May 20 Received payment from clients for services rendered last Mar 08.
Jun 01 Signed a contract and paid ₱180,000 for one year's rent for office space.
Jun 28 Paid the following:
Advertising 8,000
Registration Fees (Miscellaneous) 10,000
Jul 11 Sold its office supplies worth P10,000 for P15,000.
Jul 18 Rendered services to client amounting to P20,000.
Aug 01 Borrowed an amount money from AC Financing amounting to ₱120,000. The
principal of the loan was to be paid after two years. However, interest of
₱1,500 shall be paid at the end of each month commencing on the month the
loan was released.
Aug 13 Provided services to AZ Inc. for ₱150,000. The client paid 40% and signed a
note for the balance.
Sep 01 Signed a contract for a two-year insurance policy and paid P 100,000.
Sep 01 Purchased land amounting to P 300,000. the company paid 20% as down
payment and issued a promissory note for the balance. The promissory note
was due after 5 years. Interest attached to it was 12% per annum.
Dec 01 Lia went overseas to represent her company and paid travel costs amounting
to P50,000.

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