P5.

1
Acct#
13 Unissued Capital Stock 5,000,000.00
12 Authorized Capital Stock

4 Subscriptions receivable 1,040,000.00

14 Subscribed Capital Stock
15 Premium on Capital Stock

1 Cash in bank 700,000.00

4 Subscriptions receivable

14 Subscribed Capital Stock 600,000.00

13 Unissued Capital Stock

1 Cash in bank 2,080,000.00

13 Unissued Capital Stock
15 Premium on Capital Stock

2 Petty cash fund 1,000.00

1 Cash in bank

6 Land 200,000.00
1 Cash in bank

7 Building 1,800,000.00
1 Cash in bank

8 Furniture and Fixtures 120,000.00

1 Cash in bank

9 Office Equipment 80,000.00

1 Cash in bank

10 Store Equipment 100,000.00

1 Cash in bank

1 Cash in bank 643,000.00

3 Accounts receivable 1,252,000.00
16 Sales

17 Sales Returns and Allowances 3,000.00

? 3 Accounts receivable

18 Purchases 1,257,000.00
 19 Freight in 18,300.00
11 Accounts Payable
1 Cash in bank

? 1 Cash in bank 2,400.00

20 Purchase Returns and Allowances

22 Marketing Expenses 296,000.00

1 Cash in bank

23 General and Administrative Expenses 304,000.00

1 Cash in bank

1 Cash in bank 12,700.00

24 Commission Income

5 Prepaid insurance 2,400.00

1 Cash in bank

? 1 Cash in bank 870,000.00

3 Accounts receivable

11 Accounts Payable 618,000.00

21 Purchase Discounts
1 Cash in bank

16 Sales 1,800.00
1 Cash in bank
 pts

1
5,000,000.00

1
1,000,000.00
40,000.00

1
700,000.00

1
600,000.00

1
2,000,000.00
80,000.00

1
1,000.00

1
200,000.00

1
1,800,000.00

1
120,000.00

1
80,000.00

1
100,000.00

1
1,895,000.00

1
3,000.00

1
 1
834,000.00
441,300.00

1
2,400.00

1
296,000.00

1
304,000.00

1
12,700.00

1
2,400.00

1
870,000.00

4,500.00 1
613,500.00

1
1,800.00
23 plus 7
 Totals per Entry
Dr. Cr.
1 Cash in bank 4,308,100.00 3,960,000.00
2 Petty cash fund 1,000.00 -
3 Accounts receivable 1,252,000.00 873,000.00
4 Subscriptions receivable 1,040,000.00 700,000.00
5 Prepaid insurance 2,400.00 -
6 Land 200,000.00 -
7 Building 1,800,000.00 -
8 Furniture and Fixtures 120,000.00 -
9 Office Equipment 80,000.00 -
10 Store Equipment 100,000.00 -
11 Accounts Payable 618,000.00 834,000.00
12 Authorized Capital Stock - 5,000,000.00
13 Unissued Capital Stock 5,000,000.00 2,600,000.00
14 Subscribed Capital Stock 600,000.00 1,000,000.00
15 Premium on Capital Stock - 120,000.00
16 Sales 1,800.00 1,895,000.00
17 Sales Returns and Allowances 3,000.00 -
18 Purchases 1,257,000.00 -
19 Freight in 18,300.00 -
20 Purchase Returns and Allowances - 2,400.00
21 Purchase Discounts - 4,500.00
22 Marketing Expenses 296,000.00 -
23 General and Administrative Expenses 304,000.00 -
24 Commission Income - 12,700.00

17,001,600.00 17,001,600.00
 Totals per Given Difference
Dr. Cr. Dr. Cr.
4,308,100.00 3,960,000.00 - -
1,000.00 - -
1,252,000.00 873,000.00 - -
1,040,000.00 700,000.00 - -
2,400.00 - -
200,000.00 - -
1,800,000.00 - -
120,000.00 - -
80,000.00 - -
100,000.00 - -
618,000.00 834,000.00 - -
5,000,000.00 - -
5,000,000.00 2,600,000.00 - -
600,000.00 1,000,000.00 - -
120,000.00 - -
1,800.00 1,895,000.00 - -
3,000.00 - -
1,257,000.00 - -
18,300.00 - -
2,400.00 - -
4,500.00 - -
296,000.00 - -
304,000.00 - -
12,700.00 - -

17,001,600.00 17,001,600.00 - -
P5.2
1. Reconstruction of Journal Entries (Non-Adjusting)
11 Subscriptions Receivable 1,010,000.00
19 Subscribed Capital Stock 1,000,000.00
20 Premium on Capital Stock 10,000.00

1 Cash 480,000.00
11 Subscriptions Receivable 480,000.00

19 Subscribed Capital Stock 450,000.00

18 Capital Stock (authorized 5,000 sh 450,000.00

1 Cash 1,010,000.00
18 Capital Stock (authorized 5,000 sh 1,000,000.00
20 Premium on Capital Stock 10,000.00

12 Treasury Stock 75,000.00

21 Paid-in Capital from Donation 75,000.00

1 Cash 25,000.00
12 Treasury Stock 25,000.00

1 Cash 402,000.00
2 Accounts Receivable 886,000.00
22 Sales 1,288,000.00

3 Allowance for Doubtful Accounts 300.00

2 Accounts Receivable 300.00

1 Cash 453,000.00
24 Sales Discounts 3,200.00
2 Accounts Receivable 456,200.00

23 Purchases 829,000.00
13 Accounts Payable 435,000.00
1 Cash 394,000.00

13 Accounts Payable 316,700.00

25 Purchase Discounts 2,700.00
1 Cash 314,000.00

4 Notes Receivable (non-trade) 12,000.00

1 Cash 12,000.00
 1 Cash 4,040.00
36 Interest Income 40.00
4 Notes Receivable (non-trade) 4,000.00

9 Furniture and Equipment 1,300,000.00

1 Cash 1,300,000.00

1 Cash 60,000.00
14 Notes Payable (Non-trade) 60,000.00

14 Notes Payable (Non-trade) 24,000.00

35 Interest Expense 120.00
1 Cash 24,120.00

26 Salaries and wages 210,000.00

1 Cash 210,000.00

27 Taxes 24,500.00
1 Cash 24,500.00

29 Supplies Expense 34,700.00

1 Cash 34,700.00

30 Rent 36,000.00
1 Cash 36,000.00

31 Utility Expenses 7,900.00

1 Cash 7,900.00

34 Miscellaneous Operating Expenses 2,800.00

1 Cash 2,800.00

7 Prepaid Advertising 12,000.00

1 Cash 12,000.00

2. Reconstruction of Adjusting Entries

32 Doubtful accounts 4,430.00

3 Allowance for Doubtful Accounts 4,430.00

5 Accrued Interest Income 20.00

36 Interest Income 20.00

6 Merchandise Inventory 175,000.00

23 Purchases 175,000.00
28 Advertising 8,000.00
7 Prepaid Advertising 8,000.00

8 Unused Supplies 9,500.00

29 Supplies Expense 9,500.00

33 Depreciation - furniture and equipment 65,000.00

10 Accumulated Depreciation - Furniture and Equipmen 65,000.00

35 Interest Expense 60.00

15 Accrued Interest Expense 60.00

27 Taxes 3,300.00
16 Accrued Taxes 3,300.00

26 Salaries and wages 3,500.00

17 Accrued Salaries and Wages 3,500.00
POINTS
1

1
1

1
1 Asset Method

1 Expense Method

1
 Given
Acct. No. Dr.
1 Cash 2,434,040.00
2 Accounts Receivable 886,000.00
3 Allowance for Doubtful Accounts 300.00
4 Notes Receivable (non-trade) 12,000.00
5 Accrued Interest Income 20.00
6 Merchandise Inventory 175,000.00
7 Prepaid Advertising 12,000.00
8 Unused Supplies 9,500.00
9 Furniture and Equipment 1,300,000.00
10 Accumulated Depreciation - Furniture and Equipment
11 Subscriptions Receivable 1,010,000.00
12 Treasury Stock 75,000.00
13 Accounts Payable 316,700.00
14 Notes Payable (Non-trade) 24,000.00
15 Accrued Interest Expense
16 Accrued Taxes
17 Accrued Salaries and Wages
18 Capital Stock (authorized 5,000 shares, P 100 par value)
19 Subscribed Capital Stock 450,000.00
20 Premium on Capital Stock
21 Paid-in Capital from Donation
22 Sales
23 Purchases 829,000.00
24 Sales Discounts 3,200.00
25 Purchase Discounts
26 Salaries and wages 213,500.00
27 Taxes 27,800.00
28 Advertising 8,000.00
29 Supplies Expense 34,700.00
30 Rent 36,000.00
31 Utility Expenses 7,900.00
32 Doubtful accounts 4,430.00
33 Depreciation - furniture and equipment 65,000.00
34 Miscellaneous Operating Expenses 2,800.00
35 Interest Expense 180.00
36 Interest Income
7,937,070.00
Given From Entries Checking
Cr. Dr. Cr. Dr. Cr.
2,372,020.00 2,434,040.00 2,372,020.00 - -
456,500.00 886,000.00 456,500.00 - -
4,430.00 300.00 4,430.00 - -
4,000.00 12,000.00 4,000.00 - -
20.00 - - -
175,000.00 - - -
8,000.00 12,000.00 8,000.00 - -
9,500.00 - - -
1,300,000.00 - - -
65,000.00 - 65,000.00 - -
480,000.00 1,010,000.00 480,000.00 - -
25,000.00 75,000.00 25,000.00 - -
435,000.00 316,700.00 435,000.00 - -
60,000.00 24,000.00 60,000.00 - -
60.00 - 60.00 - -
3,300.00 - 3,300.00 - -
3,500.00 - 3,500.00 - -
1,450,000.00 - 1,450,000.00 - -
1,000,000.00 450,000.00 1,000,000.00 - -
20,000.00 - 20,000.00 - -
75,000.00 - 75,000.00 - -
1,288,000.00 - 1,288,000.00 - -
175,000.00 829,000.00 175,000.00 - -
3,200.00 - - -
2,700.00 - 2,700.00 - -
213,500.00 - - -
27,800.00 - - -
8,000.00 - - -
9,500.00 34,700.00 9,500.00 - -
36,000.00 - - -
7,900.00 - - -
4,430.00 - - -
65,000.00 - - -
2,800.00 - - -
180.00 - - -
60.00 - 60.00 - -
7,937,070.00 7,937,070.00 7,937,070.00 - -
P5.3
Merchandise Inventory - December 31, 2012 337,600.00
Income Summary 337,600.00

Doubtful Accounts 10,790.00

Allowance for Doubtful Accounts 10,790.00

Depreciation - building 50,000.00

Accumulated depreciation - building 50,000.00

Depreciation - office equipment 20,000.00

Accumulated depreciation - office equipment 20,000.00

Depreciation - store equipment 30,000.00

Accumulated depreciation - store equipment 30,000.00

Accrued interest income 120.00

Interest income 120.00

Prepaid advertising 7,200.00

Advertising expense 7,200.00

Unused office supplies 8,330.00

Office supplies expense 8,330.00

Sales taxes 12,600.00

Accrued sales taxes 12,600.00

Rent Income 2,400.00

Unearned rent income 2,400.00

Income Tax Expense 123,200.00

Income tax payable 123,200.00
??? *Might not be an adjusting entry because we are not sure whether there are any payments
??? neither is there any given for income tax expense.
there are any payments made during the year,
P5.4
Answer: Solution:
1. April 2008 =237500/50000
4.75
=December 31, 2012 - 4.75 years
=April 2008

2. Bldng - 30 =1500000/50000
O.E. - 10 =200000/20000
S.E. - 6 =180000/30000

3. 2181500 =10790/.005
=2158000
=2158000+23500

4. 316000 =15800/.05

5. Dec. 11, 2012 =18000*.12*60/360

=360
=(120/360) * 60days
=20 days
=12/31/12 - 20 days

6. Feb. 9, 2013 =Dec. 11, 2012 + 60days

7. IBIT - 352000 =123200/.35

NI - 228800 =352000-123200

8. 100 =220-120

9. 15600 =1200+12000+2400

10. 1000 =12000/12

P5.5

12 Subscriptions receivable 105,000.00

11 Subscribed capital stock
13 Premium on capital stock

1 Cash in bank 105,000.00

12 Subscriptions receivable

11 Subscribed capital stock 100,000.00

10 Capital stock

16 Dividends 20,000.00
17 Dividends payable

5 Prepaid insurance 1,200.00

1 Cash in bank

6 Furniture and equipment 100,000.00

1 Cash in bank

9 Loans payable 100,000.00

22 Interest expense 2,000.00
1 Cash in bank

4 Merchandise inventory 345,000.00

8 Accounts payable
1 Cash in bank

8 Accounts payable 287,000.00

1 Cash in bank

2 Accounts receivable 242,000.00

1 Cash in bank 208,800.00
18 Sales

19 Cost of sales 362,000.00

4 Merchandise inventory

1 Cash in bank 222,300.00

23 Sales discounts 2,700.00
2 Accounts receivable

20 Marketing expenses 38,000.00

21 General and administrative expense 21,000.00
1 Cash in bank
100,000.00
5,000.00

105,000.00

100,000.00

20,000.00

1,200.00

100,000.00

102,000.00

313,000.00
32,000.00

287,000.00

450,800.00

362,000.00

225,000.00
59,000.00
 P
Trial
1-Dec-16
Account title Dr.

1 Cash in bank 90,500.00

2 Accounts receivable 122,700.00
3 Allowance for doubtful accounts
4 Merchandise inventory 87,500.00
5 Prepaid insurance
6 Furniture and equipment 284,700.00
Accumulated depreciation furniture and
7 equipment
8 Accounts payable
9 Loans payable
10 Capital stock
11 Subscribed capital stock
12 Subscriptions receivable
13 Premium on capital stock
14 Retained earnings, December 1
15 Appropriated for contingencies
16 Dividends
17 Dividends payable
18 Sales
19 Cost of sales
20 Marketing expenses
21 General and administrative expense
22 Interest expense
23 Sales discounts
Totals 585,400.00
 GIVEN
Trial Balance as of
1-Dec-16 31-Dec-16
Cr. Dr. Cr.

626,600.00 581,200.00
364,700.00 225,000.00
2,900.00 2,900.00
432,500.00 362,000.00
1,200.00
384,700.00

65,000.00 65,000.00

62,600.00 287,000.00 375,600.00

100,000.00 100,000.00 100,000.00
300,000.00 400,000.00
100,000.00 100,000.00
105,000.00 105,000.00
10,000.00 15,000.00
24,900.00 24,900.00
20,000.00 20,000.00
20,000.00
20,000.00
450,800.00
362,000.00
38,000.00
21,000.00
2,000.00
2,700.00
585,400.00 2,847,400.00 2,847,400.00
 FROM RECONSTRUCTED ENTRIES
Trial Balance as of
1-Dec-16 31-Dec-16
Dr. Cr. Dr. Cr.

90,500.00 626,600.00 581,200.00

122,700.00 364,700.00 225,000.00
### - 2,900.00
87,500.00 432,500.00 362,000.00
1,200.00 -
284,700.00 384,700.00 -

### - 65,000.00

62,600.00 287,000.00 375,600.00

### 100,000.00 100,000.00
300,000.00 - 400,000.00
100,000.00 100,000.00
105,000.00 105,000.00
10,000.00 - 15,000.00
### - 24,900.00
### - 20,000.00
20,000.00 -
- 20,000.00
- 450,800.00
362,000.00 -
38,000.00 -
21,000.00 -
2,000.00 -
2,700.00 -
585,400.00 585,400.00
 DIFFERENCE
Trial Balance as of
1-Dec-16 31-Dec-16
Dr. Cr. Dr. Cr.

- - - -
- - - -
- - - -
- - - -
- - - -
- - - -

- - - -

- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
- - - -
P5.6

28 Store supplies used 8,000.00

4 Store supplies

27 Insurance expense 3,000.00

5 Prepaid insurance

26 Depreciation building 24,000.00

8 Accumulated depreciation building

23 Depreciation delivery equipment 12,800.00

10 Accumulated depreciation delivery equipment

25 Office salaries 6,420.00

20 Salesmens salaries 8,340.00
13 Accrued salaries payable
 Reversing Entries

8,000.00 Accrued salaries payable 14,760.00

Office salaries
Salesmen's salaries
3,000.00

24,000.00

12,800.00

14,760.00
6,420.00
8,340.00
P
As of March 31, 2016

Unadjusted trial balance

Account title Dr. Cr.

1 Cash 70,400.00
2 Inventory, January 1 190,000.00
3 Accounts receivable 107,000.00
4 Store supplies 13,400.00
5 Prepaid insurance 4,500.00
6 Land 344,000.00
7 Building 500,000.00

Accumulated depreciation
101,000.00
building
8
9 Delivery equipment 140,000.00

Accumulated depreciation
43,200.00
delivery equipment
10
11 Notes payable 29,000.00
12 Accounts payable 81,500.00

Accrued salaries payable

13
Reynaldo Corpuz, capital 1,009,940.00
14
Reynaldo Corpuz, drawing 42,000.00
15
16 Sales 1,430,000.00
Sales returns and
18,100.00
17 allowances
18 Purchases 1,093,000.00
Purchase returns and
13,000.00
19 allowances
20 Salesmens salaries 71,660.00
21 Advertising 12,000.00
22 Delivery expenses 25,000.00
Depreciation delivery
23 equipment
24 Rent expense 22,000.00
25 Office salaries 54,580.00

Depreciation building
26
27 Insurance expense
28 Store supplies used
Rent expense 2,707,640.00 2,707,640.00
s of March 31, 2016

Adjusted trial balance

Dr. Cr.

70,400.00
190,000.00
107,000.00
5,400.00
1,500.00
344,000.00
500,000.00

125,000.00

140,000.00

56,000.00

29,000.00
81,500.00

14,760.00

1,009,940.00

42,000.00

1,430,000.00

18,100.00

1,093,000.00

13,000.00

80,000.00
12,000.00
25,000.00

12,800.00

22,000.00
61,000.00

24,000.00

3,000.00
8,000.00
2,759,200.00 2,759,200.00
 Unadjusted trial balance ADJUSTING ENTRIES

Dr. Cr. Dr. Cr.

70,400.00 - -
190,000.00 - -
107,000.00 - -
13,400.00 - 8,000.00
4,500.00 - 3,000.00
344,000.00 - -
500,000.00 - -

101,000.00 - 24,000.00

140,000.00 - -

43,200.00 - 12,800.00

29,000.00 - -
81,500.00 - -

- 14,760.00

1,009,940.00 - -

42,000.00 - -

1,430,000.00 - -

18,100.00 - -

1,093,000.00 - -

13,000.00 - -

71,660.00 8,340.00 -
12,000.00 - -
25,000.00 - -

12,800.00 -

22,000.00 - -
54,580.00 6,420.00 -

24,000.00 -

3,000.00 -
8,000.00 -
2,707,640.00 2,707,640.00 62,560.00 62,560.00
 Adjusted trial balance DIFFERENCES
Dr. Cr.

70,400.00 - -
190,000.00 - -
107,000.00 - -
5,400.00 - -
1,500.00 - -
344,000.00 - -
500,000.00 - -

125,000.00
- -
140,000.00 - -

56,000.00
- -
- 29,000.00 - -
81,500.00 - -
14,760.00
- -
1,009,940.00
- -
42,000.00
- -
1,430,000.00 - -
18,100.00
- -
1,093,000.00 - -
13,000.00
- -
80,000.00 - -
12,000.00 - -
25,000.00 - -
12,800.00
- -
22,000.00 - -
61,000.00 - -
24,000.00
- -
3,000.00 - -
8,000.00 - -
2,759,200.00 2,759,200.00
KEY
A 1 Cash in Bank
A 13 Capital stock
A Investment of Cash

B 4 Materials inventory
B 7 Factory supplies inventory
B 8 Prepaid insurance
B 9 Machinery and equipment
B 14 Vouchers payable
B Purchase of inventory, equipment and insurance

C 6 Work in process inventory

C 17 Marketing expenses
C 18 Administrative expenses
C 12 Accrued payroll
Record payroll, except that for FOH, incurred for the period

D 6 Work in process inventory

D 4 Materials inventory
D Issuance of materials to WIP

E 6 Work in process inventory

E 7 Factory supplies inventory
E 8 Prepaid insurance
E 12 Accrued payroll
E 14 Vouchers payable
E Record FOH incurred during the period

F 12 Accrued payroll
F 14 Vouchers payable
F Record issuance of V/P for Accrued Payroll

G 17 Marketing expenses
G 18 Administrative expenses
G 14 Vouchers payable
G Record marketing and admin expenses for the period

H 14 Vouchers payable
H 10 Mortgage payable
H Record payment of vouchers payable via mortgage payable

I 19 Financial expenses
I 14 Vouchers payable
I Record of financial expenses to be paid for the period
J 18 Administrative expenses
J 8 Prepaid insurance
J Record expired portion of prepaid insurance applicable to admin expenses

K 5 Finished goods inventory

K 6 Work in process inventory
K Record transfer of goods completed from WIP to FG

L 2 Notes receivable
L 3 Accounts receivable
L 15 Sales
L Record sales for notes and on accounts

M 16 Cost of goods sold

M 5 Finished goods inventory
M Record cost of goods sold

N 1 Cash in Bank
N 2 Notes receivable
N 3 Accounts receivable
N Record partial collection of AR and NR

O 14 Vouchers payable
O 1 Cash in Bank
Record partial payment of VP

P 19 Financial expenses
P 11 Accrued interest on mortgage
Record accrual of interest on mortgage
 1,500,000.00
1,500,000.00

1,250,000.00
180,000.00
19,000.00
950,000.00
2,399,000.00
ent and insurance

1,165,000.00
80,000.00
90,000.00
1,335,000.00
FOH, incurred for the period

1,180,000.00
1,180,000.00

595,000.00
140,000.00
10,000.00
135,000.00
310,000.00

1,451,000.00
1,451,000.00
rued Payroll

195,000.00
195,000.00
390,000.00
expenses for the period

500,000.00
500,000.00
ayable via mortgage payable

55,000.00
55,000.00
o be paid for the period
 5,000.00
5,000.00
aid insurance applicable to admin expenses

2,800,000.00
2,800,000.00
leted from WIP to FG

200,000.00
3,400,000.00
3,600,000.00

2,500,000.00
2,500,000.00

3,140,000.00
120,000.00
3,020,000.00

3,700,000.00
3,700,000.00

7,500.00
7,500.00
total FOH = (.2*2,800,000) from total FG for the period + 35,000 from WIP, end
total FOH = 595,000

some type of FOH (Not labor, not materials, not insurance)

=275000-80000(labor)
=290000-90000(labor)-5000(insurance)
 CASH NOTES R
Key DR. Key CR. Key
A 1,500,000.00 O 3,700,000.00 L
N 3,140,000.00

4,640,000.00 3,700,000.00
E.B. 940,000.00

FINISHED GOODS INVENTORY WORK IN PROG

Key DR. Key CR. Key
K 2,800,000.00 M 2,500,000.00 C
D
E
2,800,000.00 2,500,000.00
E.B. 300,000.00

MACHINERY AND EQUIPMENT MORTGAG

Key DR. Key CR. Key
B 950,000.00

950,000.00 -
E.B. 950,000.00

CAPITAL STOCK VOUCHER

Key DR. Key CR. Key
A 1,500,000.00 H
O

- 1,500,000.00
E.B. (1,500,000.00)

MARKETING EXPENSES ADMINISTRAT

Key DR. Key CR. Key
C 80,000.00 C
G 195,000.00 G
J
275,000.00 -
E.B. 275,000.00
 NOTES RECEIVABLE ACCOUNTS REC
DR. Key CR. Key
200,000.00 N 120,000.00 L

200,000.00 120,000.00
E.B. 80,000.00

WORK IN PROGRESS INVENTORY FACTORY SUPPLIES

DR. Key CR. Key
1,165,000.00 K 2,800,000.00 B
1,180,000.00
595,000.00
2,940,000.00 2,800,000.00
E.B. 140,000.00

MORTGAGE PAYABLE ACCRUED INTEREST O

DR. Key CR. Key
H 500,000.00

- 500,000.00
E.B. (500,000.00)

VOUCHERS PAYABLE SALES

DR. Key CR. Key
500,000.00 B 2,399,000.00
3,700,000.00 E 310,000.00
F 1,451,000.00
G 390,000.00
I 55,000.00
4,200,000.00 4,605,000.00
E.B. (405,000.00)

ADMINISTRATIVE EXPENSES FINANCIAL EXP

DR. Key CR. Key
90,000.00 I
195,000.00 P
5,000.00
290,000.00 -
E.B. 290,000.00
 ACCOUNTS RECEIVABLE MATERIALS INV
DR. Key CR. Key
3,400,000.00 N 3,020,000.00 B

3,400,000.00 3,020,000.00
E.B. 380,000.00

FACTORY SUPPLIES INVENTORY PREPAID INSU

DR. Key CR. Key
180,000.00 E 140,000.00 B

180,000.00 140,000.00
E.B. 40,000.00

ACCRUED INTEREST ON MORTGAGE ACCRUED PAY

DR. Key CR. Key
P 7,500.00 F

- 7,500.00
E.B. (7,500.00)

SALES COST OF GOOD

DR. Key CR. Key
L 3,600,000.00 M

- 3,600,000.00
E.B. (3,600,000.00)

FINANCIAL EXPENSES
DR. Key CR.
55,000.00
7,500.00

62,500.00 -
E.B. 62,500.00
 MATERIALS INVENTORY
DR. Key CR.
1,250,000.00 D 1,180,000.00

1,250,000.00 1,180,000.00
E.B. 70,000.00

PREPAID INSURANCE
DR. Key CR.
19,000.00 E 10,000.00
J 5,000.00

19,000.00 15,000.00
E.B. 4,000.00

ACCRUED PAYROLL
DR. Key CR.
1,451,000.00 C 1,335,000.00
E 135,000.00

1,451,000.00 1,470,000.00
E.B. (19,000.00)

COST OF GOODS SOLD

DR. Key CR.
2,500,000.00

2,500,000.00 -
E.B. 2,500,000.00
 Transactions
Dr.

1 Cash in Bank 4,640,000.00

2 Notes receivable 200,000.00
3 Accounts receivable 3,400,000.00
4 Materials inventory 1,250,000.00
5 Finished goods inventory 2,800,000.00
6 Work in process inventory 2,940,000.00
7 Factory supplies inventory 180,000.00
8 Prepaid insurance 19,000.00
9 Machinery and equipment 950,000.00
10 Mortgage payable

Accrued interest on mortgage

11
12 Accrued payroll 1,451,000.00
13 Capital stock
14 Vouchers payable 4,200,000.00
15 Sales
16 Cost of goods sold 2,500,000.00
17 Marketing expenses 275,000.00
18 Administrative expenses 290,000.00
19 Financial expenses 62,500.00
25,157,500.00
Transactions Balances
Cr. Dr. Cr.

3,700,000.00 940,000.00
120,000.00 80,000.00
3,020,000.00 380,000.00
1,180,000.00 70,000.00
2,500,000.00 300,000.00
2,800,000.00 140,000.00
140,000.00 40,000.00
15,000.00 4,000.00
###
500,000.00 ###

7,500.00 ###

1,470,000.00 19,000.00
1,500,000.00 ###
4,605,000.00 405,000.00
3,600,000.00 ###
###
###
###
###
25,157,500.00 6,031,500.00 6,031,500.00
 Totals per Entry Differences
Dr. Cr. Dr.

4,640,000.00 3,700,000.00 -
200,000.00 120,000.00 -
3,400,000.00 3,020,000.00 -
1,250,000.00 1,180,000.00 -
2,800,000.00 2,500,000.00 -
2,940,000.00 2,800,000.00 -
180,000.00 140,000.00 -
19,000.00 15,000.00 -
950,000.00 - -
- 500,000.00 -
- 7,500.00
-
1,451,000.00 1,470,000.00 -
- 1,500,000.00 -
4,200,000.00 4,605,000.00 -
- 3,600,000.00 -
2,500,000.00 - -
275,000.00 - -
290,000.00 - -
62,500.00 - -
25,157,500.00 25,157,500.00 -
Differences
Cr.

-
-
-
-
-
-
-
-
-
-

-
-
-
-
-
-
-
-
-
-
REVERSING ENTRIES
26 Interest Income
6 Accrued interest income

27 Operating Expenses
7 Prepaid operating expenses

15 Accrued operating expenses

27 Operating Expenses

16 Accrued interest expense

30 Interest Expense

17 Unearned rent income

31 Rent Income

ENTRIES FOR TRANSACTIONS COMPLETED DURING THE YEAR

1 Cash
18 Capital stock
21 Premium on capital stock

5 Merchandise inventory
13 Accounts payable

2 Accounts receivable
4 Notes receivable
24 Sales

36 Cost of Goods Sold

5 Merchandise inventory

1 Cash
2 Accounts receivable
4 Notes receivable

1 Cash
26 Interest Income

1 Cash
31 Rent Income

1 Cash
12 Accumulated depreciation Equip.
34 Loss on Sale of Equipment
 11 Equipment

1 Cash
20 Subscriptions receivable

19 Subscribed capital stock

18 Capital stock

1 Cash
8 Investment in stock
35 Gain on Sale of Investment

13 Accounts payable
1 Cash

14 Loans payable
1 Cash

30 Interest Expense
1 Cash

27 Operating Expenses
1 Cash

11 Equipment
1 Cash

9 Furniture and fixtures

1 Cash

22 Retained earnings, December 1

32 Dividends Payable

32 Dividends Payable
1 Cash

22 Retained earnings, December 1

23 Appropriated for contingencies

ADJUSTING ENTRIES

25 Doubtful Accounts Expense

3 Allowance for doubtful accounts

6 Accrued interest income

 26 Interest Income

7 Prepaid operating expenses

27 Operating Expenses

28 Depreciation - Furniture and Fixtures

10 Accumulated depreciation F&F

29 Depreciation - Equipment
12 Accumulated depreciation Equip.

27 Operating Expenses
15 Accrued operating expenses

30 Interest Expense
16 Accrued interest expense

31 Rent Income
17 Unearned rent income
 1,000.00
1,000.00

21,000.00
21,000.00

7,600.00
7,600.00

900.00
900.00

500.00
500.00

HE YEAR

203,000.00
200,000.00
3,000.00

1,112,000.00
1,112,000.00

1,529,000.00
30,000.00
1,559,000.00

1,128,000.00
1,128,000.00

1,547,000.00
1,507,000.00
40,000.00

2,100.00
2,100.00

13,000.00
13,000.00

48,500.00
10,000.00
1,500.00
 60,000.00

60,000.00
60,000.00

100,000.00
100,000.00

11,000.00
10,000.00
1,000.00

1,106,000.00
1,106,000.00

50,000.00
50,000.00

9,800.00
9,800.00

287,000.00
287,000.00

80,000.00
80,000.00

20,000.00
20,000.00

50,000.00
50,000.00

50,000.00
50,000.00

10,000.00
10,000.00

2,400.00
2,400.00

500.00
 500.00

17,000.00
17,000.00

28,000.00
28,000.00

32,000.00
32,000.00

9,300.00
9,300.00

700.00
700.00

1,500.00
1,500.00
 ACCOUNTS RECEIVABLE NOTES RECEIVAB
Key DR. Key CR. Key
B.B. 204,000.00 COLL. 1,507,000.00 B.B.
CR. SALE 1,529,000.00 CR. SALE

1,733,000.00 1,507,000.00
E.B. 226,000.00

MERCHANDISE INVENTORY ACCOUNTS PAYAB

Key DR. Key CR. Key
B.B. 354,000.00 COGS 1,128,000.00 PAY.
CR.PUR 1,112,000.00

1,466,000.00 1,128,000.00
E.B. 338,000.00 E.B.

ACCUM. DEP. - EQUIPMENT EQUIPMENT

Key DR. Key CR. Key
DISP 10,000.00 B.B. 130,000.00 B.B.
DEP. 32,000.00 CASH PU

10,000.00 162,000.00
E.B. 152,000.00
 NOTES RECEIVABLE
DR. Key CR.
70,000.00 COLL. 40,000.00
30,000.00

100,000.00 40,000.00
E.B. 60,000.00

ACCOUNTS PAYABLE
DR. Key CR.
1,106,000.00 B.B. 187,000.00
CR.PUR 1,112,000.00

1,106,000.00 1,299,000.00
193,000.00

EQUIPMENT
DR. Key CR.
390,000.00 DISP 60,000.00
80,000.00

470,000.00 60,000.00
E.B. 410,000.00
 As of
1/1/2016
1 Cash 33,000.00
2 Accounts receivable 204,000.00
3 Allowance for doubtful accounts (4,000.00)
4 Notes receivable 70,000.00
5 Merchandise inventory 354,000.00
6 Accrued interest income 1,000.00
7 Prepaid operating expenses 21,000.00
8 Investment in stock 40,000.00
9 Furniture and fixtures 280,000.00
10 Accumulated depreciation F&F (116,000.00)
11 Equipment 390,000.00
12 Accumulated depreciation Equip. (130,000.00)
13 Accounts payable (187,000.00)
14 Loans payable (100,000.00)
15 Accrued operating expenses (7,600.00)
16 Accrued interest expense (900.00)
17 Unearned rent income (500.00)
18 Capital stock (700,000.00)
19 Subscribed capital stock (100,000.00)
20 Subscriptions receivable 60,000.00
21 Premium on capital stock (20,000.00)
22 Retained earnings, December 1 (67,000.00)
23 Appropriated for contingencies (20,000.00)
-

24 Sales
25 Doubtful Accounts Expense
26 Interest Income
27 Operating Expenses
Depreciation - Furniture and Fixtures
28
29 Depreciation - Equipment
30 Interest Expense
31 Rent Income
32 Dividends Payable
33 Income Summary
34 Loss on Sale of Equipment
35 Gain on Sale of Investment
36 Cost of Goods Sold

(Net Income)/Loss
As of FROM ENTRIES
12/31/2016 DR. CR.
314,800.00 1,884,600.00 1,602,800.00
226,000.00 1,529,000.00 1,507,000.00
(6,400.00) - 2,400.00
60,000.00 30,000.00 40,000.00
338,000.00 1,112,000.00 1,128,000.00
500.00 500.00 1,000.00
17,000.00 17,000.00 21,000.00
30,000.00 - 10,000.00
300,000.00 20,000.00 -
(144,000.00) - 28,000.00
410,000.00 80,000.00 60,000.00
(152,000.00) 10,000.00 32,000.00
(193,000.00) 1,106,000.00 1,112,000.00
(50,000.00) 50,000.00 -
(9,300.00) 7,600.00 9,300.00
(700.00) 900.00 700.00
(1,500.00) 500.00 1,500.00
(1,000,000.00) - 300,000.00
100,000.00 -
- 60,000.00
(23,000.00) - 3,000.00
(86,400.00) 60,000.00 -
(30,000.00) - 10,000.00
- 6,008,100.00 5,928,700.00

- 1,559,000.00
2,400.00 -
1,000.00 2,600.00
317,300.00 24,600.00

28,000.00 -
32,000.00 -
10,500.00 900.00
1,500.00 13,500.00
50,000.00 50,000.00
- -
1,500.00 -
- 1,000.00
1,128,000.00 -
TRIES Difference
12/31/2016
314,800.00 -
226,000.00 -
(6,400.00) -
60,000.00 -
338,000.00 -
500.00 -
17,000.00 -
30,000.00 -
300,000.00 -
(144,000.00) -
410,000.00 -
(152,000.00) -
(193,000.00) -
(50,000.00) -
(9,300.00) -
(700.00) -
(1,500.00) -
(1,000,000.00) -
- -
- -
(23,000.00) -
(7,000.00) (79,400.00)
(30,000.00) -
79,400.00 - (79,400.00)

(1,559,000.00)
2,400.00
(1,600.00)
292,700.00

28,000.00
32,000.00
9,600.00
(12,000.00)
-
-
1,500.00
(1,000.00)
1,128,000.00

(79,400.00)
 DUNHILL METAL INDUSTRIES, INC.
STATEMENT OF COST OF GOOD MANUFACTURED
FOR THE YEAR ENDED DECEMBER 31, 2016

Materials, Beginning Balance -

Add: Purchases of Materials 282,500.00
Purchase Returns of Materials (2,500.00)
Less: Materials, Ending Balance (28,000.00)
Materials Used 252,000.00
Direct Labor 140,000.00
Manufacturing Overhead 210,000.00
Total Manufacturing Cost 602,000.00
Add: WIP, Beginning -
Less: WIP, End (60,200.00)
Cost of Goods Manufactured 541,800.00

DUNHILL METAL INDUSTRIES, INC.

INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2016

Sales
Less: COGS
Cost of Goods Manufactured 541,800.00
Add: Merchandise Inventory, Beg. -
Cost of Goods Available for Sale 541,800.00
Less: Merchandise Inventory, End (135,450.00)
Gross Profit
Less: Marketing Expenses
Administrative Expenses
Income before Income Tax
Less: Income Tax
Net Income (Loss)

DUNHILL METAL INDUSTRIES, INC.

BALANCE SHEET
AS OF DECEMBER 31, 2016

ASSETS
Current Assets
Cash 29,112.00
Accounts Receivable 113,778.00
Materials Inventory 28,000.00
Work-in-Process Inventory 60,200.00
Merchandise Inventory 135,450.00
 Noncurrent Assets
Factory Equipment 250,000.00
Accumulated Depreciation - Factory Equipment (20,000.00)
Marketing Equipment 70,000.00
Accumulated Depreciation - Marketing Equipment (7,000.00)
Office Equipment 40,000.00
Accumulated Depreciation - Office Equipment (4,000.00)
TOTAL ASSETS

LIABILITIES
Accounts Payable 56,000.00
Salaries Payable 3,000.00
Income Tax Payable 10,962.00

SHAREHOLDERS' EQUITY
Paid-up Capital 600,000.00
Retained Earnings 25,578.00
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
 S, INC.
ANUFACTURED Source of Information
ER 31, 2016

1
1
2

4
5

S, INC.

ER 31, 2016

568,890.00 8

406,350.00 7
162,540.00 8
(70,000.00) 10
(56,000.00) 11
36,540.00 15
(10,962.00) 16
25,578.00

S, INC.

016

3,4,5,9,10,11,12,13
9
2
6
366,540.00 7
 14
5
14
10
14
329,000.00 11
695,540.00

3
4
69,962.00

12
625,578.00 15,16
695,540.00
 CASH
Key DR. Key
Investment 600,000.00 Purchase of Fixed Assets
Collection of AR 455,112.00 Payment of AP
Payment of SP
Payment of MOH

Payment of Marketing Exp.

 Payment of Admin. Exp
1,055,112.00
E.B.
 CR.
360,000.00
224,000.00
137,000.00
190,000.00

63,000.00
 52,000.00
1,026,000.00
29,112.00
A. B=.1(Net Income - 1000000 - B)
B=.1(3200000 - 1000000 - B)
B=220000-.1B
1.1B=220000
B=200000

B. Total Estimated Liability before redemption = P3 * (.6* (No. of packages sold / 5 ))

Total Estimated Liability before any redemption = P2,880,000
Amount of Liability already redeemed = P 3 * (No. of coupons redeemed / 5)
Amount of Liability already redeemed = P1,200,000
Estimated liability for premium claims outstanding = Total Estimated Liability - Amount alre
Estimated liability for premium claims outstanding = P1,680,000

C. Merchandise Inventory Acco

Key DR. Key CR. Key
B.B. - COGS 1,800,000.00 Payment
Purchase 2,400,000.00

2,400,000.00 1,800,000.00
E.B. 600,000.00 E.B.

ANS: P640,000

D. Cost of Goods Available for Sale = Ending merchandise inventory + Cost of Sales
Cost of Goods Available for Sale = 900,000 + 14,000,000*
Cost of Goods Available for Sale = 14,900,000

*Cost of Sales = 700%*200,000

E. Sales @ BEP = Fixed Costs / Contribution Margin Ratio

Contribution Margin Ratio = (Sales - Variable Costs)/Sales
Contribution Margin Ratio = 40%
Sales @ BEP = 800,000 / 40%
Sales @ BEP = 2,000,000

F. 100,000 = .4SP(200,000) - 400,000)

SP = P6.25
 es sold / 5 ))

Liability - Amount already redeemed

Accounts Payable Accounts Receivable

DR. Key CR. Key DR.
2,000,000.00 Purchase 2,400,000.00 Sales 2,340,000.00

2,000,000.00 2,400,000.00 2,340,000.00

400,000.00

Cost of Sales
Accounts Receivable
Key CR.
Collections 1,700,000.00

1,700,000.00
E.B. 640,000.00
Key Account name:
A 5 Subscriptions receivable
A 12 Capital stock subscribed
A 14 Premium on capital stock

B 1 Cash in bank
B 5 Subscriptions receivable

C 12 Capital stock subscribed

C 13 Capital stock paid-up

D 1 Cash in bank
D 13 Capital stock paid-up

E 2 Petty cash fund

E 1 Cash in bank

F 1 Cash in bank
F 10 Bank loan

G 10 Bank loan
G 1 Cash in bank

H 7 Furniture and equipment

H 1 Cash in bank

I 16 Purchases
I 9 Accounts payable

J 9 Accounts payable
J 18 Purchase returns and allowances

K 3 Accounts receivable
K 15 Sales

L 17 Sales returns and allowances

L 3 Accounts receivable

M 1 Cash in bank
M 3 Accounts receivable

N 9 Accounts payable
N 1 Cash in bank

O 19 Salaries
O 20 Rent
O 21 Insurance
O 22 Taxes and licenses
O 23 Advertising
O 24 Office supplies
O 25 Maintenance and repairs
O 28 General expenses
O 1 Cash in bank

ADJUSTING ENTRIES
P 26 Bad debts
P 4 Allowance for bad debts

Q 27 Depreciation furniture and equipment

Q 8 Allowance for depreciation Furniture and equipment

R 28 General expenses
R 11 Accrued expenses

S 6 Prepaid insurance
S 21 Insurance
Dr. Cr.
55,000.00
50,000.00
5,000.00

44,000.00
44,000.00

40,000.00
40,000.00

100,000.00
100,000.00

1,500.00
1,500.00

75,000.00
75,000.00

30,000.00
30,000.00

55,555.00
55,555.00

400,000.00
400,000.00

2,000.00
2,000.00

500,000.00
500,000.00

6,600.00
6,600.00

334,000.00
334,000.00

290,000.00
290,000.00

30,000.00
 7,200.00
1,330.00
12,000.00
4,800.00
2,100.00
1,900.00
34,200.00
93,530.00

8,330.00
8,330.00

5,330.00
nd equipment 5,330.00

2,000.00
2,000.00

330.00
330.00
 CASH IN BANK PETTY CASH FUND
Key DR. Key CR. Key DR.
B 44,000.00 E 1,500.00 E 1,500.00
D 100,000.00 G 30,000.00
F 75,000.00 H 55,555.00
M 334,000.00 N 290,000.00
O 93,530.00
553,000.00 470,585.00 1,500.00
E.B. 82,415.00

SUBSCRIPTIONS RECEIVABLE PREPAID INSURANCE

Key DR. Key CR. Key DR.
A 55,000.00 B 44,000.00 S 330.00
55,000.00 44,000.00 330.00
E.B. 11,000.00

ACCOUNTS PAYABLE BANK LOAN

Key DR. Key CR. Key DR.
J 2,000.00 I 400,000.00 G 30,000.00
N 290,000.00
292,000.00 400,000.00 30,000.00
E.B. (108,000.00)

CAPITAL STOCK PAID-UP PREMIUM ON CAPITAL STO

Key DR. Key CR. Key DR.
C 40,000.00
D 100,000.00
- 140,000.00 -
E.B. (140,000.00)

SALES RETURNS AND ALLOWANCES PURCHASE RETURNS AND ALLO

Key DR. Key CR. Key DR.
L 6,600.00
6,600.00 - -
E.B. 6,600.00

INSURANCE TAXES AND LICENSES

Key DR. Key CR. Key DR.
O 1,330.00 S 330.00 O 12,000.00
1,330.00 330.00 12,000.00
E.B. 1,000.00

MAINTENANCE AND REPAIRS BAD DEBTS

Key DR. Key CR. Key DR.
O 1,900.00 P 8,330.00

1,900.00 - 8,330.00
E.B. 1,900.00
PETTY CASH FUND ACCOUNTS RECEIVABLE
Key CR. Key DR. Key CR.
K 500,000.00 L 6,600.00
M 334,000.00

- 500,000.00 340,600.00
E.B. 1,500.00 E.B. 159,400.00

REPAID INSURANCE FURNITURE AND EQUIPMENT

Key CR. Key DR. Key CR.
H 55,555.00
- 55,555.00 -
E.B. 330.00 E.B. 55,555.00

BANK LOAN ACCRUED EXPENSES

Key CR. Key DR. Key CR.
F 75,000.00 R 2,000.00

75,000.00 - 2,000.00
E.B. (45,000.00) E.B. (2,000.00)

IUM ON CAPITAL STOCK SALES

Key CR. Key DR. Key CR.
A 5,000.00 K 500,000.00

5,000.00 - 500,000.00
E.B. (5,000.00) E.B. (500,000.00)

RETURNS AND ALLOWANCES SALARIES

Key CR. Key DR. Key CR.
J 2,000.00 O 30,000.00
2,000.00 30,000.00 -
E.B. (2,000.00) E.B. 30,000.00

AXES AND LICENSES ADVERTISING

Key CR. Key DR. Key CR.
O 4,800.00
- 4,800.00 -
E.B. 12,000.00 E.B. 4,800.00

BAD DEBTS DEPRECIATION - FURNITURE AND EQUIP.

Key CR. Key DR. Key CR.
 Q 5,330.00

- 5,330.00 -
E.B. 8,330.00 E.B. 5,330.00
 ALLOWANCE FOR BAD DEBTS
Key DR. Key CR.
P 8,330.00

- 8,330.00
E.B. (8,330.00)

ALLOWANCE FOR DEPRECIATION - F&E

Key DR. Key CR.
Q 5,330.00
- 5,330.00
E.B. (5,330.00)

CAPITAL STOCK SUBSCRIBED

Key DR. Key CR.
C 40,000.00 A 50,000.00

40,000.00 50,000.00
E.B. (10,000.00)

PURCHASES
Key DR. Key CR.
I 400,000.00

400,000.00 -
E.B. 400,000.00

RENT
Key DR. Key CR.
O 7,200.00
7,200.00 -
E.B. 7,200.00

OFFICE SUPPLIES
Key DR. Key CR.
O 2,100.00
2,100.00 -
E.B. 2,100.00

GENERAL EXPENSES
Key DR. Key CR.
O 34,200.00
R 2,000.00
36,200.00 -
E.B. 36,200.00
 1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Cash in bank
Petty cash fund
Accounts receivable
Allowance for bad debts
Subscriptions receivable
Prepaid insurance
Furniture and equipment
Allowance for depreciation Furniture and equipment
Accounts payable
Bank loan
Accrued expenses
Capital stock subscribed
Capital stock paid-up
Premium on capital stock
Sales
Purchases
Sales returns and allowances
Purchase returns and allowances
Salaries
Rent
Insurance
Taxes and licenses
Advertising
Office supplies
Maintenance and repairs
Bad debts
Depreciation furniture and equipment
General expenses
Totals
 GIVEN From Entries
Debit Credit Debit Credit
553,000 470,585 553,000.00 470,585.00
1,500 1,500.00 -
500,000 340,600 500,000.00 340,600.00
8,330 - 8,330.00
55,000 44,000 55,000.00 44,000.00
330 330.00 -
55,555 55,555.00 -
5,330 - 5,330.00
292,000 400,000 292,000.00 400,000.00
30,000 75,000 30,000.00 75,000.00
2,000 - 2,000.00
40,000 50,000 40,000.00 50,000.00
140,000 - 140,000.00
5,000 - 5,000.00
500,000 - 500,000.00
400,000 400,000.00 -
6,600 6,600.00 -
2,000 - 2,000.00
30,000 30,000.00 -
7,200 7,200.00 -
1,330 330 1,330.00 330.00
12,000 12,000.00 -
4,800 4,800.00 -
2,100 2,100.00 -
1,900 1,900.00 -
8,330 8,330.00 -
5,330 5,330.00 -
36,200 36,200.00 -
2,043,175 2,043,175 2,043,175.00 2,043,175.00
 From Entries
Debit Credit
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
- -
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