INTRODUCTION TO ACCOUNTING

Practice Exercises- Solution

Exercise 1: The Accounting Equation

Problem 1.1

ASSETS LIABILITIES EQUITY

a. P50,000 P30,000 P20,000

b. P132,560 P86,779 P45,781

c. P1,462,836 P230,856 P1,231,980

d. P270,974 P36,000 P234,974

e. P1,376,079 P922,119 P453,960

f. P2,911,349 P1,906,785 P1,004,564

g. P2,543,786 P1,008,971 P1,534,815

h. P2,787,866 P800,001 P1,987,865

i. P1,890,675 P955,695 P934,980

j. P1,245,080 P789,005 P456,075

Problem 1.2

ASSETS LIABILITIES EQUITY

a. P2,560,000 P345,879 P2,214,121

b. P3,786,370 P1,135,911 P2,650,459

c. P560,000 P140,000 P420,000

d. P2,180,000 P872,000 P1,308,000

e. P1,140,000 P456,000 (40% of Asset) P684,000

f. P384,750 (135% of P99,750 P285,000

Equity)
 INTRODUCTION TO ACCOUNTING:
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g. P653,225 P202,725 (45% of Equity) P450,500

h. P697,391 P410,230 P287,161 (70% of Liabilities)

i. P396,260 P158,504 P237,756 (60% of Asset)

j. 1,457,300 (125% of P1,165,840 P291,460

Liabilities)

Problem 1.3

EQUITY INVESTMENT REVENUE EXPENSE DRAWINGS

a. P3,860,660 P3,450,760 P2,456,765 P1,706,865 P340,000

b. P4,500,657 P5,111,927 P2,455,765 P1,567,035 P1,500,000

c. P5,670,322 P2,394,706 P7,549,416 P3,706,800 P567,000

d. P3,768,985 P3,450,086 P5,450,005 P4,124,101 P1,007,005

e. P2,564,912 P5,000,541 P1,043,765 P2,300,543 P1,178,851

Problem 1.4

ASSET LIABILITIES EQUITY(end) INVESTMENT REVENUE EXPENSE

a. P2,450,000 P345,000 P2,105,000 P772,345 P1,567,000 P234,345

b. P2,531,667 P398,765 P2,132,902 P1,907,907 P459,801 P234,806

c. P2,387,777 P1,152,027 P1,235,750 P1,590,000 P345,000 P699,250

d. P3,675,980 P769,400 P2,906,580 P2,576,250 P560,877 P230,547

e. P8,441,867 P3,876,991 P4,564,876 P1,800,400 P4,642,419 P1,877,943

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 INTRODUCTION TO ACCOUNTING:
Solution to Practice Exercises
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Problem 1.5

ASSETS LIABILITIES EQUITY

a. P300,000 P300,000

b. P75,000 (P75,000)

c. P10,500 (P10,500)

d. P30,400 P30,400

e. (P10,000) (P10,000)

P320,400 P320,400

Problem 1.6

ASSETS LIABILITIES EQUITY

a. P570,000 P285,000 P285,000

b. P500,000 P500,000

c. P12,000 P12,000

d. P25,000 P25,000

e. (P3,000) (P3,000)

f. (P9,000) (P9,000)

g. (P5,000) (P5,000)

h. P75,000 P75,000

i. (P23,000) (P23,000)

j. (P10,000) (10,000)

P1,132,000 P310,000 P822,000

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 INTRODUCTION TO ACCOUNTING:
Solution to Practice Exercises
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Problem 1.7

ASSETS LIABILITIES EQUITY

a. P1,140,000 P1,140,000

b. P42,000 (P42,000)

c. P35,000 P35,000

d. P7,000 P7,000

e. P76,000 P76,000

f. (P35,000) (P35,000)

g. (P7,000) P7,000

h. P500,000 P500,000

i. P76,000 (P76,000)

j. (P27,000) (P27,000)

k. P28,000 (P28,000)

l. (P50,000) (P50,000)

m. (P50,000) (P50,000)

P1,596,000 P478,000 P1,118,000

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 INTRODUCTION TO ACCOUNTING:
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Exercise 2: Journal Entries and T-Account

Problem 2.1
Journal Entries

Cash P300,000
George, Capital P300,000

Equipment P75,000
Cash P75,000

Supplies P10,500
Cash P10,500

Cash P30,400
Service Revenue P30,400

Various Expenses P10,000

Cash P10,000

T-Account

Cash Equipment Supplies

P300,000 P75,000 P10,500

P75,000
P10,500
P30,400
P10,000

P234,900 P75,000 P10,500

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 INTRODUCTION TO ACCOUNTING:
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Various Expenses Service Revenue George, Capital

P10,000 P30,400 P300,000

P10,000 P30,400 P300,000

Problem 2.2
Journal Entries

Jan 1 Cash P570,000

Loans Payable P285,000
Faye, Capital P285,000

Jan 1 Equipment P500,000

Faye, Capital P500,000

Jan 12 Office Supplies P12,000

Accounts Payable P12,000

Jan 12 Equipment P25,000

Accounts Payable P25,000

Jan 15 Accounts Payable P3,000

Cash P3,000

Jan 23 Accounts Payable P9,000

Cash P9,000

Jan 29 Supplies Expense P5,000

Office Supplies P5,000

Jan 31 Cash P75,000

Service Revenue P75,000

Jan 31 Various Expenses P23,000

Cash P23,000

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Jan 31 Faye, Drawings P10,000

Cash P10,000

T-Account

Cash Equipment Office Supplies

Jan 1 P570,000 Jan 1 P500,000 Jan 12 P12,000

Jan 15 P3,000 Jan 29 P5,000
Jan 12 P25,000
Jan 23 P9,000

Jan 31 75,000

Jan 31 P23,000

Jan 31 10,000

P600,000 P525,000 P7,000

Accounts Payable Loans Payable Various Expenses

Jan 12 P12,000 Jan 1 P285,000 Jan 31 23,000

Jan 12 P25,000

Jan 15 P3,000

Jan 23 P9,000

P25,000 P285,000 P23,000

Supplies Expense Service Revenue Faye, Drawings

Jan 29 P5,000 Jan 31 P75,000 Jan 31 P10,000

P5,000 P75,000 P10,000

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 INTRODUCTION TO ACCOUNTING:
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Faye, Capital

Jan 1 285,000

Jan 1 P500,000

P785,000

Problem 2.3
Journal Entries

Feb 3 Cash P540,000

Equipment P450,000
Furniture P150,000
Seran, Capital P1,140,000

Feb 4 Salon Supplies P42,000

Cash P42,000

Feb 5 Furniture P35,000

Accounts Payable P35,000

Feb 7 Cash P7,000

Unearned Revenue P7,000

Feb 14 Accounts Receivable P76,000

Service Revenue P76,000

Feb 15 Accounts Payable P35,000

Cash P35,000

Feb 16 Unearned Revenue P7,000

Service Revenue P7,000

Feb 18 Cash P500,000

Loans Payable P500,000

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 INTRODUCTION TO ACCOUNTING:
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Feb 18 Cash P76,000

Accounts Receivable P76,000

Feb 28 Supplies Expense P27,000

Salon Supplies P27,000

Feb 28 Utilities Expense P28,000

Utilities Payable P28,000

Feb 28 Loans Payable P50,000

Cash P50,000

Feb 28 Seran, Drawings P50,000

Cash P50,000

T-Account

Cash Equipment Furniture

Feb 3 P540,000 Feb 3 P450,000 Feb 3 150,000

Feb 4 42,000
Feb 7 P7,000 Feb 5 P35,000
Feb 15 P35,000
Feb 18 P500,000
Feb 28 P50,000
Feb 28 P76,000
Feb 28 P50,000

P946,000 P450,000 P185,000

Salon Supplies Accounts Receivable Accounts Payable

Feb 4 42,000 Feb 14 P76,000 Feb 5 P35,000

Feb 31 27,000 Feb 31 P76,000 Feb15 P35,000

P15,000 P0 P0

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 INTRODUCTION TO ACCOUNTING:
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Loans Payable Unearned Revenue Utilities Payable

Feb 18 P500,000 Feb 7 P7,000 Feb 28 P28,000

Feb 28 P50,000 Feb 16 P7,000

P450,000 P0 P28,000

Utilities Expense Supplies Expense Service Revenue

Feb 28 P28,000 Feb 28 P27,000 Feb 14 P76,000

Feb 16 P7,000

P28,000 P27,000 P83,000

Seran, Drawings Seran, Capital

Feb 28 P50,000 Feb 3 1,140,000

P50,000 P1,140,000

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 INTRODUCTION TO ACCOUNTING:
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Problem 2.4
Journal Entries

Sept 1 Cash P400,000

X, Capital P400,000

Sept 3 Prepaid Rent P45,000

Cash P45,000

Sept 6 Cash P22,250

Service Revenue P22,250

Sept 8 Cash P7,200

Unearned Revenue P7,200

Sept 13 Accounts Receivable P16,350

Service Revenue P16,350

Sept 15 Supplies P4,300

Cash P4,300

Sept 23 Cash P12,600

Accounts Receivable P12,600

Sept 30 Salaries Expense P22,400

Cash P22,400

Sept 30 Electric and Gas Expense P38,500

Electric and Gas Payable P38,500

Sept 30 Rent Expense P15,000

Prepaid Rent P15,000

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T-Account

Cash Prepaid Rent Accounts Receivable

Sept 1 P400,000 Sept 3 P45,000 Sept 13 P16,350

Sept 3 P45,000 Sept 23 P12,600
Sept 6 P22,250 Sept 30 P15,000

Sept 8 P7,200
Sept 15 P4,300

Sept 23 P12,600
Sept 30 P22,400

P370,350 P30,000 P3,750

Supplies Unearned Revenue Electric and Gas Payable

Sept 15 P4,300 Sept 8 P7,200 Sept 30 P38,500

P4,300 P7,200 P38,500

Electric and Gas Expense Salaries Expense Rent Expense

Sept 30 P38,500 Sept 30 P22,400 Sept 30 P15,000

P38,500 P22,400 P15,000

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 INTRODUCTION TO ACCOUNTING:
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Service Revenue X, Capital

Sept 6 P22,250 Sept 1 P400,000

Sept 13 P16,350

P38,600 P400,000

Problem 2.5
Journal Entries

May 1 Cash P1,500,000

Dizon, Capital P1,500,000

May 3 Office Supplies P9,500

Cash P9,500

May 6 Furniture and Fixtures P556,000

Cash P556,000

May 7 Office Equipment P576,800

Accounts Payable P576,800

May 14 Salaries Expense P22,000

Cash P22,000

May 15 Cash P298,000

Service Revenue P298,000

May 18 Gas and Oil Expense P4,350

Gas and Oil Payable P4,350

May 23 Cash P80,000

Notes Payable P80,000

May 29 Supplies Expense P3,500

Office Supplies P3,500

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 INTRODUCTION TO ACCOUNTING:
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May 30 Salaries Expense P22,000

Cash P22,000

Problem 2.6
Journal Entries

Dec 1 Cash P90,000

Magdiwang, Capital P90,000

Dec 5 License Expense P15,000

Cash P15,000

Dec 6 Furniture and Fixtures P33,000

Cash P33,000

Dec 7 Service Equipment P23,000

Cash P11,500
Accounts Payable P11,500

Dec 7 Service Supplies P11,500

Accounts Payable P11,500

Dec 9 Cash P21,900

Service Revenue P21,900

Dec 12 Accounts Receivable P14,250

Service Revenue P14,250

Dec 14 Cash P53,200

Magdiwang, Capital P53,200

Dec 15 Accounts Receivable P23,400

Service Revenue P23,400

Dec 22 Cash P14,250

Accounts Receivable P14,250

Dec 23 Accounts Payable P5,500

Cash P5,500

Dec 25 Magdiwang, Drawing P17,000

Cash P17,000

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 INTRODUCTION TO ACCOUNTING:
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Dec 29 Rent Expense P12,500

Cash P12,500

Dec 30 Cash P50,000

Loans Payable P50,000

Dec 31 Supplies Expense P6,500

Service Supplies P6,500

Dec 31 Salaries Expense P23,500

Cash P23,500

Exercise 3: Trial Balance

Problem 3.1
Journal Entries

Jan 1 Cash P550,000

Loans Payable P357,500
Macalintal, Capital P192,000

Jan 2 Prepaid Rent P36,000

Cash P36,000

Jan 3 Equipment P80,000

Cash P60,000
Notes Payable P20,000

Jan 4 Office Supplies P17,600

Accounts Payable P17,600

Jan 13 Cash P28,500

Service Revenue P28,500

Jan 13 Accounts Payable P17,600

Cash P17,600

Jan 14 Wages Expense P34,100

Cash P34,100

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Jan 18 Cash P32,900

Accounts Receivable P21,200
Service Revenue P54,100

Jan 23 Cash P15,300

Accounts Receivable P15,300

Jan 25 Cash P4,000

Unearned Revenue P4,000

Jan 26 Office Supplies P5,200

Accounts Payable P5,200

Jan 28 Wages Expense P34,100

Cash P34,100

Jan 31 Rent Expense P12,000

Prepaid Rent P12,000

Jan 31 Electricity Expense P2,470

Electricity Payable P2,470

Jan 31 Telephone Expense P1,494

Telephone Payable P1,494

Jan 31 Miscellaneous Expense P3,470

Cash P3,470

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 INTRODUCTION TO ACCOUNTING:
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PAPA AUDIT ACCOUNTING FIRM

Trial Balance
January 31, 2020

ACCOUNT TITLE DEBIT CREDIT

Cash P445,430
Accounts Receivable P21,200
Prepaid Rent P24,000
Office Supplies P22,800
Equipment P80,000
Accounts Payable P5,200
Note Payable P20,000
Loans Payable P357,500
Electricity Payable P2,470
Telephone Payable P1,494
Unearned Revenue P4,000
Wages Expense P68,200
Rent Expense P12,000
Electricity Expense P2,470
Telephone Expense P1,494
Miscellaneous Expense P3,470
Service Revenue P97,900
Macalintal, Capital P192,500
Total P681,064 P681,064

Problem 3.2
Journal Entries

May 1 Cash P400,000

Loans Payable P200,000
Halimuyak, Capital P200,000

May 3 Prepaid Rent P50,000

Cash P50,000

May 4 Office Supplies P16,000

Accounts Payable P16,000

May 6 Cash P58,000

Service Revenue P58,000

May 7 Accounts Payable P16,000

Cash P16,000

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May 7 Equipment P360,000

Cash P100,000
Notes Payable P260,000

May 9 Office Supplies P23,500

Accounts Payable P23,500

May 12 Accounts Receivable P42,500

Service Revenue P42,500

May 13 Accounts Payable P9,400

Cash P9,400

May 14 Wages Expense P56,000

Cash P56,000

May 14 Cash P63,680

Accounts Receivable P162,640
Service Revenue P226,320

May 20 Accounts Payable P14,100

Cash P14,100

May 27 Cash P43,000

Unearned Revenue P43,000

May 28 Wages Expense P56,000

Wages Payable P56,000

May 28 Electricity Expense P36,750

Electricity Payable P36,750

May 28 Telephone Expense P28,755

Telephone Payable P28,755

May 31 Miscellaneous Expense P15,340

Cash P15,340

May 31 Rent Expense P10,000

Prepaid Rent P10,000

May 31 Supplies Expense P29,500

Office Supplies P29,500

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May 31 Bad Debts Expense P20,514

Allowance for Bad Debts P20,514

HALIMUYAK MASSAGE SERVICES

Trial Balance
May 31, 2020

ACCOUNT TITLE DEBIT CREDIT

Cash P303,840
Accounts Receivable P205,140
Allowance for Bad Debts P20,514
Prepaid Rent P40,000
Office Supplies P10,000
Equipment P360,000
Accounts Payable P0
Notes Payable P260,000
Loans Payable P200,000
Electricity Payable P36,750
Telephone Payable P28,755
Wages Payable P56,000
Unearned Revenue P43,000
Wages Expense P112,000
Rent Expense P10,000
Supplies Expense P29,500
Electricity Expense P36,750
Telephone Expense P28,755
Miscellaneous Expense P15,340
Bad Debts Expense P20,514
Service Revenue P326,820
Halimuyak, Capital P200,000
Total P1,171,839 P1,171,839

Problem 3.3
Journal Entries

July 3 Cash P240,000

Macapuno, Capital P240,000

July 5 Equipment P130,500

Accounts Payable P130,500

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July 9 Cash P24,000

Unearned Revenue P24,000

July 10 Accounts Receivable P15,500

Service Revenue P15,500

July 12 Utilities Expense P7,300

Cash P7,300

July 14 Macapuno, Drawings P23,000

Cash P23,000

July 17 Cash P12,800

Service Revenue P12,800

July 18 Accounts Payable P130,500

Cash P130,500

July 20 Salaries Expense P23,600

Cash 23,600

July 23 Cash P15,500

Accounts Receivable P15,500

July 27 Accounts Receivable P11,200

Service Revenue P11,200

July 30 Supplies P4,500

Accounts Payable P4,500

July 31 Depreciation Expense P2,175

Accumulated Depreciation P2,175

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COCO-PON BOND PRIINTING SERVICES

Trial Balance
July 31, 2020

ACCOUNT TITLE DEBIT CREDIT

Cash P107,900
Accounts Receivable P11,200
Supplies P4,500
Equipment P130,500
Accumulated Depreciation P2,175
Accounts Payable P4,500
Unearned Revenue P24,000
Salaries Expense P23,600
Utilities Expense P7,300
Depreciation Expense P2,175
Macapuno, Drawings P23,000
Service Revenue P39,500
Macapuno, Capital P240,000
Total P310,175 P310,175

Problem 3.4
Journal Entries

Nov 1 Cash P700,000

Rocketeer, Capital P700,000

Nov 8 Prepaid Rent P120,000

Cash P120,000

Nov 9 Equipment P200,000

Cash P200,000

Nov 10 Office Supplies P36,000

Accounts Payable P36,000

Nov 16 Cash P169,400

Service Revenue P169,400

Nov 16 Accounts Payable P36,000

Cash P36,000

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Nov 20 Cash P143,700

Accounts Receivable P120,200
Service Revenue P263,900

Nov 21 Salaries Expense P73,500

Cash P73,500

Nov 21 Cash P120,200

Accounts Receivable P120,200

Nov 22 Cash P56,300

Unearned Revenue P56,300

Nov 24 Accounts Receivable P240,000

Service Revenue P240,000

Nov 27 Supplies Expense P20,550

Office Supplies P20,550

Nov 28 Electricity Expense P25,850

Electricity Payable P25,850

Nov 28 Telephone Expense P12,950

Telephone Payable P12,950

Nov 28 Miscellaneous Expense P42,320

Cash P42,320

Nov 29 Rent Expense P20,000

Prepaid Rent P20,000

Nov 30 Depreciation Expense P2,083

Accumulated Depreciation P2,083

Nov 30 Bad Debts Expense P12,000

Allowance for Bad Debts P12,000

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BIBA RAKETERA ADVERTISING COMPANY

Trial Balance
November 30, 2020

ACCOUNT TITLE DEBIT CREDIT

Cash P717,780
Accounts Receivable P240,000
Allowance for Bad Debts P12,000
Prepaid Rent P100,000
Office Supplies P15,450
Equipment P200,000
Accumulated Depreciation P2,083
Accounts Payable P0
Electricity Payable P25,850
Telephone Payable P12,950
Unearned Revenue P56,300
Salaries Expense P73,500
Rent Expense P20,000
Supplies Expense P20,550
Electricity Expense P25,850
Telephone Expense P12,950
Miscellaneous Expense P42,320
Bad Debts Expense P12,000
Depreciation Expense P2,083
Service Revenue P673,300
Rocketeer, Capital P700,000
Total P1,482,483 P1,482,483

Problem 3.5
Journal Entries

Jan 1 Cash P1,960,000

Zubiri, Capital P1,960,000

Jan 2 Prepaid Rent P120,000

Cash P120,000

Jan 3 Equipment P500,000

Cash P310,000
Notes Payable P190,000

Jan 3 Office Supplies P340,000

Accounts Payable P340,000

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Jan 4 Cash P570,000

Service Revenue P570,000

Jan 6 Accounts Payable P340,000

Cash P340,000

Jan 7 Cash P135,000

Accounts Receivable P240,000
Service Revenue P375,000

Jan 9 Office Supplies P65,000

Accounts Payable P65,000

Jan 10 Cash P140,000

Accounts Receivable P140,000

Jan 11 Salaries Expense P48,750

Cash P48,750

Jan 12 Accounts Payable P65,000

Cash P65,000

Jan 15 Cash P50,000

Accounts Receivable P50,000

Jan 17 Office Supplies P75,000

Cash P75,000

Jan 21 Cash P35,000

Accounts Receivable P35,000

Jan 22 Cash P225,000

Service Revenue P225,000

Jan 24 Cash P65,000

Unearned Revenue P65,000

Jan 25 Salaries Expense P48,750

Cash P48,750

Jan 26 Cash P15,000

Accounts Receivable P15,000

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Jan 28 Supplies Expense P215,000

Office Supplies P215,000

Jan 30 Accounts Receivable P765,000

Service Revenue P765,000

Jan 31 Depreciation Expense P4,167

Accumulated Depreciation P4,167

Jan 31 Rent Expense P10,000

Prepaid Rent P10,000

Jan 31 Miscellaneous Expense P750,000

Cash P750,000

Jan 31 Bad Debts Expense P76,500

Allowance for Bad Debts P76,500

ZOOTOPIA PET GROOMING SHOP

Trial Balance
January 31, 2020

ACCOUNT TITLE DEBIT CREDIT

Cash P1,437,500
Accounts Receivable P765,000
Allowance for Bad Debts P76,500
Prepaid Rent P110,000
Office Supplies P265,000
Equipment P500,000
Accumulated Depreciation P4,167
Accounts Payable P0
Notes Payable P190,000
Unearned Revenue P65,000
Salaries Expense P97,500
Rent Expense P10,000
Supplies Expense P215,000
Miscellaneous Expense P750,000
Bad Debts Expense P76,500
Depreciation Expense P4,167
Service Revenue P1,935,000
Zubiri, Capital P1,960,000
Total P4,230,667 P4,230,667

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