Republic of the Philippines

CEBU TECHNOLOGICAL UNIVERSITY

MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

Name: Joselyn B. Heruela Subject: Bookkeeping and Accounting BDA 602

Topic: Recording of Transaction

Test I:

Years ago, William Shakespeare operated a part-time business from his home. As of April 1,
2012, William decided to move a rented quarters and operated the business, which was to be
known as Shakespeare and Family In., on a full-time basis. Shakespeare and Family entered in
the following transactions during April:

Date Transactions
April 4 The following assets were received from William Shakespeare: cash Php
10,000; accounts receivable Php 8,500, supplies Php 1,250; and office
equipment Php 7,500. There were no liabilities received.
April 4 Paid three months rent on a lease rental contract Php 4,500
April 4 Paid the premium on property and casualty insurance policies for the year,
Php 1,800
April 6 Received cash from clients as an advance payment for services to be
provided, Php 3,000
April 7 Purchased additional office furniture on account from Abaca Company
Php1,800
April 8 Received cash from clients on account Php 800
April 11 Paid cash for newspaper advertisement Php 120
April 12 Paid Abaca Company Php 800 for debt incurred on April 7
April 15 Recorded services provided on account for the period April 4-15, Php 2250
April 15 Paid part-time receptionist for two weeks salary Php 400
April 15 Recorded cash from clients for fees earned April 4-15, Php 3,175
April 18 Paid cash for supplies Php 750
April 22 Recorded services provided on account for April 18-22, Php 1,100
April 22 Recorded cash from clients for fees earned on April 18-22 , Php 1,850
April 25 Received cash from clients on account, Php 1,600
April 27 Paid part-time receptionist for two weeks salary, Php 400
April 28 Paid telephone bill for April, Php 1,200
April 29 Paid electric bill for April 1,300
April 29 Recorded cash from client for fees earned April 25-29 Php 2,050
April 29 Recorded services provided on account for April 25-29 Php 1,000
April 29 William received Php 4,500 from the company as his salary

Instructions:
1. Record the transaction stated above in good general form.
2. Post the transactions to T-Accounts.
3. Record and post the following adjustments:
A. Insurance expired in April Php 1500
B. Supplies on hand April 29, Php 1500
C. Depreciation for the office equipment in April 500
D. Accrued receptionist salary on April 30, Php 180
E. Rent expired in April, 1500
F. Earned 2000 of services that were previously paid last April 6
4. Prepare and Income Statement, Statement of Retained Earnings and Balance sheet.
 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

5. Record and post-closing entries.

6. Prepare a post-closing trial balance.

General Journal
Date Account Title Debit Credit
April 4 Cash 10,000
Accounts Receivable 8,500
Supplies 1,250
Office Equipment 7,500
Contributed Capital 27,250
April 4 Prepaid Rent 4,500
Cash 4,500
April 4 Prepaid Insurance 1,800
Cash 1,800
April 6 Cash 3,000
Unearned Revenue 3,000
April 7 Office Equipment 1,800
Accounts Payable 1,800
April 8 Cash 800
Accounts Receivable 800
April 11 Advertising Expense 120
Cash 120
April 12 Accounts Payable 800
Cash 800
April 15 Accounts Receivable 2,250
Service Revenue 2,250
April 15 Salaries Expense 400
Cash 400
April 15 Cash 3,175
Service Revenue 3,175
April 18 Supplies 750
Cash 750
April 22 Accounts Receivable 1,100
Service Revenue 1,100
April 22 Cash 1,850
Service Revenue 1,850
April 25 Cash 1,600
Accounts Receivable 1,600
April 27 Salary Expense 400
Cash 400
April 28 Telephone Expense 1,200
Cash 1,200
April 29 Utilities Expense 1,300
Cash 1,300
April 29 Cash 2,050
Service Revenue 2,050
April 29 Accounts Receivable 1,000
Service Revenue 1,000
 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

April 29 Salaries Expense 4,500

Cash 4,500

General Journal
Adjusting Journal Entries
Date Account Title Debit Credit
April 30 Insurance Expense 1,500
(a) Prepaid Insurance 1,500

April 30 Supplies Expense 1,500

(b) Supplies 1,500

April 30 Depreciation Expense 500

(c) Accumulated Depreciation 500

April 30 Salaries Expense 180

(d) Salaries Payable 180

April 30 Rent Expense 1,500

(e) Prepaid Rent 1,500

April 30 Unearned Revenue 2,000

(f) Service Revenue 2,000

Cash Prepaid Insurance

4/4 10,000 4,500 4/4 4/4 1,800

4/6 3,000 1,800 4/4
1,500 AJE (a)
4/8 800 120 4/11
4/15 3,175 800 4/12
End Bal 300
4/22 1,850 400 4/15
4/25 1,600 750 4/18
4/29 2,050 400 4/27 Office Equipment
1,200 4/28
4/4 7,500
1,300 4/29
4/7 1,800
4,500 4/29

End Bal 6,705 End Bal 9,300

 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

Accounts Receivable Accumulated Depr

500 AJE (c)

4/4 8,500 800 4/8
4/15 2,250 1,600 4/25
End Bal 500
4/22 1,100
4/29 1,000
Accounts Payable

End Bal 10,450 1,800 4/7

4/12 800
Supplies End Bal 1,000

4/4 1,250 Salaries Payable

4/18 750
180 AJE (d)
1,500 AJE (b)
End Bal 500
End Bal 180

Prepaid Rent Unearned Revenue

4/4 4,500 3,000 4/6

1,500 AJE (e) AJE (f) 2,000
End Bal 3,000 End Bal 1,000

Contributed Capital Rent Expense

27,250 4/4 AJE (e) 1,500

End Bal 1,500

End Bal 27,250

Retained Earnings Supplies Expense

0 4/1 AJE (b) 1,500

End Bal 1,500

End Bal -
 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

Service Revenue Salaries Expense

2,250 4/15
4/15 400
3,175 4/15
4/27 400
1,100 4/22
4/29 4,500
1,850 4/22
AJE (d) 180
2,050 4/29
End Bal 5,480
1,000 4/29
2,000 AJE (f) Telephone Expense
End Bal 13, 425 4/28 1,200

End Bal 1,200

Insurance Expense Utilities Expense

4/29 1,300
AJE (a) 1,500
End Bal 1,300
End Bal 1,500
Advertising Expense
Depr Exp
4/11 120
AJE (c) 500

End Bal 120

End Bal 500
 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

Shakespeare & Family Inc.

Adjusted Trial Balance
For the Year Ended December 31st, 2012
Debit Credit

Cash Php 6,705

Accounts Receivable 10,450

Prepaid Rent 3,000

Prepaid Insurance 300

Supplies 1,300

Office Equipment 9,300

Accumulated Depreciation, Equipment Php 500

Accounts Payable 1,000

Salaries Payable 180

Unearned Revenue 1,000

Contributed Capital 27,250

Retained Earnings 0

Dividends Declared 0

Service Revenue 13,425

Insurance Expense 1,500

Depreciation Expense 500

Rent Expense 1,500

Supplies Expense 1,500

Salaries Expense 5,480

Telephone Expense 1,200

Utilities Expense 1,300

Advertising Expense 120

Php 44,155 Php 44,155

 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

Shakespeare & Family Inc.

Income Statement
For the Year Ended April 30, 2012

Revenues
Service Revenue Php 14,625
Total Revenues 14,625

Expenses
Insurance Expense 1,500
Depreciation Expense 500
Rent Expense 1,500
Supplies Expense 1,500
Salaries Expense 5,480
Telephone Expense 1,200
Utilities Expense 1,300
Advertising Expense 120
Total Expenses 13,100

Net Income (Loss) Pphp 1,525

Shakespeare & Family Inc.

Statement of Retained Earnings
For the Year Ended April 30, 2012

Beg Retained Earnings, 4/1/12 Php 0

Add: Net Income 1,525
Less: Dividends 0
End Retained Earnings, 4/30/12 Php 1,525
 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

Shakespeare & Family Inc.

Balance Sheet
At April 30, 2012

Assets
Current Assets
Cash Php 6,705
Accounts Receivable 10,450
Prepaid Rent 3,000
Prepaid Insurance 300
Supplies 500
Total Current Assets Php 20,955
Property Plant & Equipment
Office Equipment 9,300
Accumulated Depreciation (500)
Property Plant & Equipment, Net 8,800
Total Assets 29,755

Liabilities & Stockholders’ Equity

Liabilities
Current Liabilities
Accounts Payable 1,000
Salaries Payable 180
Total Current Liabilities 1,180
Unearned Revenue 1,000
Total Liabilities 2,180

Stockholders’ Equity
Contributed Capital 27,250
Retained Earnings 5,475
Total Stockholders’ Equity 32,725

Total Liabilities & Stockholders’ Equity

 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

General Journal
Closing Journal Entries
Date Account Title Debit Credit
April 30 Service Revenue 13,425
CJE #1 Insurance Expense 1,500
Depreciation Expense 500
Rent Expense 1,500
Supplies Expense 1,500
Salaries Expense 5,480
Telephone Expense 1,200
Utilities Expense 1,300
Advertising Expense 120
Retained Earnings 5,475

April 30
CJE #2
 Republic of the Philippines
CEBU TECHNOLOGICAL UNIVERSITY
MAIN CAMPUS
M. J. Cuenco Avenue Cor. R. Palma Street, Cebu City, Philippines
Website: http://www.ctu.edu.ph E-mail: cmemain@ctu.edu.ph

Shakespeare & Family Inc.

Post-Closing Trial Balance
For the Year Ended December 31, 2010

Debit Credit

Cash Php 6,705

Accounts Receivable 10,450
Prepaid Rent 3,000
Prepaid Insurance 300
Supplies 1,300
Office Equipment 9,300
Accumulated Depreciation, Equipment 500
Accounts Payable 1,000
Salaries Payable 180
Unearned Revenue 1,000
Contributed Capital 27,250
Retained Earnings 5,475
Dividends Declared 0
Service Revenue 0
Insurance Expense 0
Depreciation Expense 0
Rent Expense 0
Supplies Expense 0
Salaries Expense 0
Telephone Expense 0
Utilities Expense 0
Advertising Expense 0