DEMONSTRATION PROBLEM 1 DP 1.

The trial balance of Irene’s Laundry on June 30 is show below:

Account No. Debit Credit

101 Cash P 8,750

112 Accounts receivable 2,320
126 supplies 1,900
157 Equipment 9,000
201 Account payable P5,500
206 unearned revenue 800
301 Irene Bora, Capital ______ 15,670

P21,940 P21,970

The July transaction were as follows:

July 5 Received P850 cash from customer on account

10 Billed customers for services performed, P6,800
15 Paid employee salaries P1,400
16 Performed P600 of services for customers who paid in advance in june
20 Paid P2,000 to creditors on account.
21 Received P250 for services rendered on a cash basis
26 Purchased supplies on account, at a cost of P350
29 Withdrew P600 for personal use
30 Paid utilities P900

Additional info.

Provision should be made for the following additional accounts:

# 306 Irene Baro,drawings,# 426 Laundry Revenue, # 726 Salaries Expense, and #
732 Utilities expense.

INSTRUCTIONS:

Using the sheets provided,submit the following:

DP1.1 Chart of account

DP1.2 July journal entries
DP1.3 General Ledger postings for the month
DP1.4 Trial balance
DP1.5 Income statement
DP1.6 Balance sheet
DP1.7 Post-closing trial balance
DEMONSTRATION PROBLEM 2 (DP2)

Hawk Hardware store completed the following merchandising transactions in the

month of April 2007. At the beginning of april, the ledger of Hawk showed cash of
P5,500 and F. Horno,Capital of P5,500

April 1 Purchased merchandise on account from Regional Wholesale supply,

P4,000 terms n/30
2 Sold merchandise on account, P4,300 terms n/30
5 Received credit from Regional Wholesale supply for merchandise returned,
P250
7 Paid, P150 freight on april 2 sales
11 Purchased supplies for cash P850
12 Purchased merchandise for cash, P850
16 Received refund for poor quality merchandise from supplier on cash
purchase P350
17 Purchased merchandise from Hunslow Distributors,P1,700 terms n/30
18 Paid freight on April 17 purchase P220
24 Sold merchandise for cash P6,300
25 Purchased merchandise from Horizon Inc. P1,100 terms n/30
26 Received collections in full from customer billed April 2
29 Made refunds to cash customers for defective merchandise P120
30 Paid Regional wholesale Supply in full
31 Sold merchandise on account P1,500 FOB Hawk’s store terms n/30

Hawk Hardware’s chart of account includes the following : No. 101 cash, No.112
accounts receivable, No.120 Merchandise inventory, No.126 Supplies, No.201
Accounts Payable, No.301 F. Horn Capital, No.401 Sales, No.412 Sales Returns
and Allowances, No. 510 Purchases, No.512 purchase returns and allowances.
No.516 Freight, and No.644 freight out.

INSTRUCTIONS
Using the sheets provided, submit the following:

DP2 April Journal entries