Problem 1:

Use the following adjusted trial balance and additional information to complete the requirements:
Ann Teak Store
Adjusted Trial Balance
December 31, 2016

Cash P19,000
Merchandise inventory 52,000
Store supplies 1,000
Equipment 40,000
Accumulated depreciation - equipment P16,500
Accounts payable 8,000
Salaries payable 1,000
Ann Teak, Capital 69,000
Ann Teak, Withdrawals 8,000
Sales 320,000
Sales discounts 20,000
Purchases 147,000
Purchase discounts 12,000
Freight in 11,000
Depreciation expense 5,500
Salaries expense 60,000
Insurance expense 12,000
Rent expense 24,000
Store supplies expense 6,000
Advertising expense 21,000
426,500 426,500

A physical count shows that the cost of the years ending inventory is P50,000.

Prepare the following requirements:

1. Statement of Cost of Goods Sold
2. Income Statement
3. Closing entries
4. Statement of Changes in Owners Equity
5. Balance Sheet

Problem 2:
The following information appeared in a companys income statement:
Sales P300,000
Sales returns 15,000
Sales discounts 4,500
Beginning inventory 25,000
Purchases 180,000
Purchase returns and allowances 6,000
Purchase discounts 3,600
Freight in 11,000
Gross profit from sales 105,000
Net income 55,000
REQUIRED:
Compute the following:
1. Total operating expenses _____________
2. Cost of goods sold _____________
3. Merchandise inventory, end _____________

Problem 3:
Given the following accounts with normal year-end balances, prepare the entry to close the income
statement accounts that have debit balances:

Merchandise inventory . . . . . . . . . . . . . P 34,800

Jan Dean, capital . . . . . . . . . . . . . . . . . . . 115,300
Jan Dean, withdrawals . . . . . . . . . . . . . . . . 4,000
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157,200
Sales returns and allowances . . . . . . . . . . . 3,500
Sales discounts . . . . . . . . . . . . . . . . . . . . . . 1,700
Purchases . . . . . . . . . . . . . . . . . . . . . . . . 102,000
Purchases returns and allowances . . . . . . 8,100
Purchases discounts . . . . . . . . . . . . . . . . . . 2,000
Transportation-in . . . . . . . . . . . . . . . . . . . . 5,400
Amortization expense . . . . . . . . . . . . . . . . 7,300
Salaries expense . . . . . . . . . . . . . . . . . . . 29,500
Miscellaneous expenses . . . . . . . . . . . . . . 1,900

Refer to the information in QS 53. Prepare the entry to close the income statement accounts that have
debit balances assuming the business uses the adjusting entry approach to record the change in
merchandise inventory.

Problem 4:
Calculate net sales and gross profit in each of the following situations:

a b c d
Sales . . . . . . . . . . . . . . . . . . . . . P125,000 P505,000 P33,700 P256,700
Sales discounts . . . . . . . . . . . . . . . . 3,200 13,500 300 4,000
Sales returns and allowances . . . 19,000 3,000 6,000 600
Cost of goods sold . . . . . . . . . . . . .67,600 352,700 22,300 123,900

A company purchased merchandise that cost P165,000 during the year that just ended. Determine the
companys cost of goods sold in each of the following four situations:
a. There were no beginning or ending inventories.
b. There was a beginning inventory of P35,000 and no ending inventory.
c. There was a P30,000 beginning inventory and a P42,000 ending inventory.
d. There was no beginning inventory but there was a P21,000 ending inventory