FUNDAMENTALS OF

ABM 1 & 2
ACCOUNTING EXERCISES
JOURNAL
ENTRY
Ms Chiu open a laundry business on Jan. 2,
2016. She Invested PHP500,000 to her
business. The trade name of the business
was “MS. LABANDERA”
Cash 500,000
Chiu, Capital 500,000
To record investment by owner.
Collections from various customers
for the day - PHP3,000

Cash 3,000
Service Income 3,000
To record collection from customer.
Purchase store supplies from
Labada Store - PHP10,000

Office Supplies 10,000

Cash 10,000
To record purchase of supplies.
 Sikat Hotel availed the services of MS.
LABANDERA amounting to PHP15,000.
Payment will be made on January 20, 2016.

Accounts Receivable 15,000

Service Income 15,000
To record rendered service on account.
Purchase a washing machine on
account amounting to PHP50,000

Property, Plant & Equipment 50,000

Accounts Payable 500,000
To record purchase of equipment on account.
Paid electricity bill for the month
amounting to PHP18,000

Utilities Expense 1,800

Cash 1,800
To record payment to electricity.
Received payment from Sikat Hotel
amounting to PHP15,000.

Cash 15, 000

Accounts Receivable 15,000
To record payment of Sikat Hotel.
Ms. CHIU needed money for the
hospitalization of his son. He withdrew
PHP18,000 from the business.

Chiu, Drawing 18,000

Cash 18,000
To record withdrawal of Ms. Chiu.
Purchased office supplies pay P5,000 and
issue a note for the remaining P3,000.

Office Supplies 8,000

Cash 5,000
Notes Payable 3,000
To record purchase of supplies.
 ACCOUNTING
EQUATION PRACTICE!
ASSETS = OWNER’S EQUITY +
LIABILITIES
Learning is Fun Company had current assets
amounting to Php 100,000. Noncurrent
assets for the year totaled Php 76,000. How
much is the company’s total assets?

Answer: P176,000.
Happy Selling Company’s total liabilities
amounted Php 10,000. Total equity had
an ending balance of Php 20,000. How
much is total assets?

Answer: P30,000.
Happy Selling’s had the following accounts at
year end: Cash-250,000, Accounts Payable-
70,000, Prepaid Expense-15,000. Compute
for the company’s current assets.

Answer: P265,000.
Happy Selling’s Accounts Receivable amounted to Php
500,000. Prepaid Expense and PPE totaled Php 30,000
and Php 90,000 respectively. Cash balance amounted
to Php 100,000 while Accounts Payable and Unearned
Income totaled to Php 20,000 and Php 10,000
respectively. How much is the company’s current
assets? Current liabilities?

Answer: P630,000 and P30,000

Company’s Total Liabilities and Equity amounted
to Php 285,000. Total noncurrent assets ended at
Php 85,000. Cash totaled Php50,000. Inventory
amounted to Php100,000. Assuming the company
had no other assets, how much is Accounts
Receivable?

Answer: P50,000.
Total assets amounted to Php575,000. Total
equity amounted to Php 250,000. Accounts
Payable amounted to Php 50,000 while Unearned
Income totaled Php 85,000. Assuming there are
no other current liabilities, compute for the
company’s noncurrent liabilities.

Answer: P190,000
 If assets are Php17,000 and
owner's equity is Php10,000,
liabilities are _______________.
Answer: Php 7,000 (Topic: Assets = Liabilities
+ Owner’s Equity)
At the end of the first month of operations for Juana’s
Delivery Service, the business had the following accounts:
Accounts Receivable, Php1,200; Prepaid Insurance,
Php500; Equipment, Php36,200 and Cash, Php40,650. On
the same date, Juana owed the following creditors: Nena’s
Supply Company, Php12,000; Maria’s Equipment,
Php9,500.The current assets for the Juana’s Delivery
Service are _________.

Answer:Php42,350
 At the end of the first month of operations for Juana’s
Delivery Service, the business had the following accounts:
Accounts Receivable, Php1,200; Prepaid Insurance,
Php500; Equipment, Php36,200 and Cash, Php40,650. On
the same date, Juana owed the following creditors: Nena’s
Supply Company, Php12,000 (due in 6 months); Maria’s
Equipment, Php9,500 (due after 2 years).Current liabilities
are _________.

Answer: Php12,000
THANK YOU!