KAPS Beauty Salon

Unadjusted Trial Balance

31-Dec-12

Debit Credit

Cash 40,000
Accounts Receivable 50,000
Allowance for Doubtful Accounts 500
Notes Receivable 20,000
Office Supplies 10,000
Prepaid Insurance 30,000
Prepaid Rent 40,000
Land 200,000
Building 300,000
Accumulated Depreciation - Building 15,000
Furniture and Fixtures 30,000
Machineries 25,000
Accounts Payable 30,000
Notes Payable 25,000
Loan Payable 150,000
Kaps, Capital 368,000
Kaps, Drawing 15,000
Service Income 415,000
Salaries Expense 115,000
Rent Expense 88,000
Utilities Expense 40,500
TOTAL 1,003,500 1,003,500

Data for adjustments:

a) The note receivable is a 60-day, 12% note dated December 16, 2012.
b) The 10-year loan payable carries an annual interest of 10% payable on the end of the
term which is on December 31, 2021.
c) Unused office supplies amounts to P6,000.
d) Prepaid insurance was paid on October 1, 2012 and is good for 5 months.
e) Prepaid rent represents 4-month rent starting December 2012.
f) Unearned income amounts to P8,000.
g) Salaries of P5,000 is still unpaid.
h) Utilities expenses for December 2012 are P4,000. These are due on January 2013.
i) 4% of the accounts receivable are expected to be doubtful.
j) Depreciation for Building is P15,000 per year
k) Furniture and fixtures are expected to lasts for 6 years. These were bought
on January 1, 2012.
l) Machineries were bought on April 1, 2012. These are expected to lasts for 8 years
with P1,000 salvage value.
 KAPS Beauty Salon
Worksheet
for Year-Ended December 31, 2012

Unadjusted Adjusted Income Statement of

Accounts Title Trial Balance Adjustments Trial Balance Statement Financial Position
Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit
Cash 40,000 40,000 40,000
Accounts Receivable 50,000 50,000 50,000
Allowance for Doubtful Accounts 500 1,500 2,000 2,000
Notes Receivable 20,000 20,000 20,000
Office Supplies 10,000 4,000 6,000 6,000
Prepaid Insurance 30,000 18,000 12,000 12,000
Prepaid Rent 40,000 10,000 30,000 30,000
Land 200,000 200,000 200,000
Building 300,000 300,000 300,000
Accumulated Depreciation - Building 15,000 15,000 30,000 30,000
Furniture and Fixtures 30,000 30,000 30,000
Machineries 25,000 25,000 25,000
Accounts Payable 30,000 30,000 30,000
Notes Payable 25,000 25,000 25,000
Loan Payable 150,000 150,000 150,000
Kaps, Capital 368,000 368,000 368,000
Kaps, Drawing 15,000 15,000 15,000
Service Income 415,000 8,000 407,000 407,000
Salaries Expense 115,000 5,000 120,000 120,000
Rent Expense 88,000 10,000 98,000 98,000
Utilities Expense 40,500 4,000 44,500 44,500
TOTALs 1,003,500 1,003,500
Interest Receivable 100 100 100
Interest Income 100 100 100
Interest Expense 15,000 15,000 15,000
Interest Payable 15,000 15,000 15,000
Supplies Expense 4,000 4,000 4,000
Insurance Expense 18,000 18,000 18,000
Unearned Income 8,000 8,000 8,000
Salaries Payable 5,000 5,000 5,000
Utilities Payable 4,000 4,000 4,000
Doubtful Account 1,500 1,500 1,500
Depreciation Expense - Building 15,000 15,000 15,000
Depreciation Expense - Furniture and Fixtures 5,000 5,000 5,000
Accumulated Depreciation - Furniture and Fixtures 5,000 5,000 5,000
Depreciation Expense - Machineries 2,250 2,250 2,250
Accumulated Depreciation - Machineries 2,250 2,250 2,250
TOTALs 87,850 87,850 1,051,350 1,051,350 323,250 407,100 728,100 644,250
Net Income 83,850 83,850
TOTALs 407,100 407,100 728,100 728,100
 KAPS Beauty Salon
Income Statement
for Year-Ended December 31, 2012

Service Income 407,000

Add Other Income: Interest Income 100
Total Income 407,100

Less: Expenses
Salaries Expense 120,000
Rent Expense 98,000
Utilities Expense 44,500
Interest Expense 15,000
Supplies Expense 4,000
Insurance Expense 18,000
Doubtful Account 1,500
Depreciation Expense - Building 15,000
Depreciation Expense - Furniture and Fixtures 5,000
Depreciation Expense - Machineries 2,250 323,250
Net Income 83,850

KAPS Beauty Salon

Capital Statement
for Year-Ended December 31, 2012

Capital, January 1, 2012 368,000

Add: Net Income 83,850
Total 451,850
Less: Drawing 15,000
Capital, December 31, 2012 436,850
 KAPS Beauty Salon
Statement of Financial Position
31-Dec-12

Assets

Current Assets
Cash 40,000
Accounts Receivable 50,000
Allowance for Doubtful Accounts 2,000 48,000
Notes Receivable 20,000
Office Supplies 6,000
Prepaid Insurance 12,000
Prepaid Rent 30,000
Interest Receivable 100 156,100

Non-Current Assets
Land 200,000
Building 300,000
Accumulated Depreciation - Building 30,000 270,000
Furniture and Fixtures 30,000
Accumulated Depreciation - Furniture and Fixtures 5,000 25,000
Machineries 25,000
Accumulated Depreciation - Machineries 2,250 22,750 517,750

TOTAL ASSETS 673,850

Liabilities and Capital

Current Liabilities
Accounts Payable 30,000
Notes Payable 25,000
Unearned Income 8,000
Salaries Payable 5,000
Utilities Payable 4,000 72,000

Long-Term Liabilities
Loan Payable 150,000
Interest Payable 15,000 165,000

Total Liabilities 237,000

KAPS, Capital 436,850

TOTAL LIABILITIES AND CAPITAL 673,850