Date Accounts Debit Credit

1/1/2024 Cash 2,000,000

Owner's Capital 2,000,000
To record owner's investment to the business
1/2/2024 Equipment 1,000,000
Cash 1,000,000
to record the acquisition of equipment for cash
1/3/2024 Cash 500,000
Notes payaple 500,000
To record bank loan
1/4/2024 Prepaid insurance 160,000
Cash 160,000
To record the prepayment of insurance
1/5/2024 Cash (6mx1/3)
Accounts receivable 2,000,000
Service fees 2,000,000
To record service fees
1/6/2024 Cash 1,800,000
Accounts recievable 1,800,000
To record collection of accounts receivable
1/7/2024 salaries expense 1,200,000
cash 1,200,000
to record salaries expense
1/8/2024 utilities expense 500,000
Cash 500,000
to record utilities expense
1/9/2024 Prepaid Supplies 120,000
Cash 120,000
To record purchase of Supplies
1/10/2024 Owner's Drawing 1,400,000
Cash 1,400,000
To record owner's drawing
ASSETS
Cash Accounts Receivable
2,000,000 4,000,000 1,800,000
500,000 1,000,000 2,200,000
2,000,000 160,000
1,800,000 1,200,000
500,000
120,000
1,400,000
6,300,000 4,380,000
1,920,000

Prepaid Insurance Prepaid Supplies

160,000 120,000
160,000 120,000

Equipment
1,000,000
1,000,000

LIABILITIES

Notes Payable
500,000
500,000

EQUITY

Owner's Capital Owner's Drawing

2,000,000 1,400,000
2,000,000 1,400,000

INCOME

Service fees
6,000,000
6,000,000

EXPENSES

Salaries Expense Utilities Expense

120,000 500,000
120,000 500,000
 Entity A
Unadjusted Trial Balance
December 31, 20x1

Accounts Debit Credit

Cash 1,920,000
Accounts Receivable 2,200,000
Prepaid Insurance 160,000
Prepaid Supplies 120,000
Equipment 1,000,000
Notes payable 500,000
owner's captial 2,000,000
Owner's drawing 1,400,000
Service fees 6,000,000
Salaries expense 1,200,000
Utilities expense 500,000
Totals 8,500,000 8,500,000
(i) Depreciation expense (1M/10) 100,000
Accumulated depreciation
To record the depreciation expense for the year
(ii) Interest expense (500K x 12% x 6/12) 30,000
Interest payable
To accrue interest expense
(iii) Insurance expense (160K X 3/12) 40,000
Prepaid insurance
To recognize insurance expense
(iv) Supplies expenses (120K - 40K) 80,000
Prepaid supplies
To recognize supplies expense
100,000

30,000

40,000

80,000
 Unadjusted trial balance Adjustments
Accounts Debit credit Debit Credit
Cash 1,920,000
Accounts Receivable 2,200,000
Prepaid Insurance 160,000 40,000
Prepaid Supplies 120,000 80,000
Equipment 1,000,000
Notes payable 500,000
owner's captial 2,000,000
Owner's drawing 1,400,000
Service fees 6,000,000
Salaries expense 1,200,000
Utilities expense 500,000
Totals 8,500,000 8,500,000

Adjustments:
Depreciation expense 100,000
Accumulated depreciation 100,000
Interest expense 30,000
Interest payable 30,000
Insurance expense 40,000
Supplies expense 80,000
Totals 250,000 250,000
 Entity A
Worksheet
December 31, 20x1
Adjusted trial balance Income Statement Balance sheet
Debit Credit Debit Credit Debit Credit
1,920,000 1,920,000
2,200,000 2,200,000
120,000 120,000
40,000 40,000
1,000,000 1,000,000
500,000 500,000
2,000,000 2,000,000
1,400,000 1,400,000
6,000,000 6,000,000
1,200,000 1,200,000
500,000 500,000

100,000 100,000
100,000 100,000
30,000 30,000 30,000
30,000
40,000 40,000
80,000 80,000
8,630,000 8,630,000 1,950,000 6,000,000 6,680,000 2,630,000
4,050,000 4,050,000
6,000,000 6,000,000 6,680,000 6,680,000
 Closing Entries Post-closing entries
Debit Credit Debit Credit
1,920,000
2,200,000
120,000
40,000
1,000,000
500,000
2,650,000 4,650,000
1,400,000
6,000,000
1,200,000
500,000

100,000
100,000
30,000 30,000

40,000
80,000
6,000,000 6,000,000 5,280,000 5,280,000
Dec. 31, 20x1 Service fees 6,000,000
Salaries expense 1,200,000
Utilities expense 500,000
Deprecition expense 100,000
Interest expense 30,000
Insurance expense 40,000
Supplies expense 80,000
Income summary 4,050,000
To close income and expense accounts to income summary
Dec. 31, 20x1 Income summary 4,050,000
Owner's equity 4,050,000
To close the income summary to equity
Dec. 31, 20x1 Owner's equity 1,400,000
Owner's drawing 1,400,000
To close the drawing account
 Entity A
Balance Sheet
As of December 31, 20x1

ASSETS
Cash ₱ 1,920,000.00
Accounts Receivable 2,200,000
Prepaid Insurance 120,000
Prepaid Supplies 40,000
Equipment 1,000,000
Accumulated depreciation -100,000
TOTAL ASSETS ₱ 5,180,000.00

LIABILITIES
Notes payable ₱ 500,000.00
Interest payable 30,000
TOTAL LIABILITIES 530,000

EQUITY
Owner's equity 4,650,000
TOTAL EQUITY 4,650,000

TOTAL EQUITY AND TOTAL LIABILITIES ₱ 5,180,000.00

 Entity A
Income Statement
For the month ended December 31, 20x1

INCOME
Service Fees 6,000,000

EXPENSES
Salaries expense -1,200,000
utilities expense -500,000
Depreciation expense -100,000
Interest expense -30,000
Insurance expense -40,000
Supplies expense -80,000
TOTAL EXPENSES -1,950,000

PROFIT FOR THE PERIOD 4,050,000