EXAMPLES OF FINANCIAL STATEMENTS

VC Portrait
Income Statement
For the Month Ended December 31, 2019

Portrait Revenue P 117,000

Less: Operating Expenses
Supplies Expense P 25,000
Utility Expense 22,000
Rent Expense 20,000
Wages Expense 14,000
Depreciation Expense –
Photography Equipment 1,700
Depreciation Expense –
Office Equipment 500
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Total Operating Expenses 83,200

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Net Income P 33,800

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Illustration 1-3 Income Statement-Service Business-Single Proprietorship

VC Portrait
Statement of Owner’s Equity
For the Month Ended December 31, 2019

Capital, December 1 P 300,000

Add: Net Income 33,800
________________________________
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P 333,800
Less: Vic Castro, Personal 20,000
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Capital, December 31 P 313,800

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Illustration 1-4 Statement of Owner’s Equity-Service Business-Single Proprietorship

VC Portrait
Statement of Financial Position
December 31, 2019

Assets

Current Assets:
Cash P 189,000
Accounts Receivable 13,000
Photography Supplies 5,000
Prepaid Rent 20,000

1
 Total Current Assets P 227,000

Non-Current Assets:
Property, Plant and Equipment:
Photography Equipment P 100,000
Less: Accumulated Depreciation 1,700 P 98,300
Office Equipment P 50,000
Less: Accumulated Depreciation 500 49,500
Total Non-Current Assets 147,800
Total Assets P 374,800

Liabilities and Owner’s Equity

Current Liabilities:
Accounts Payable P 50,000
Utilities Payable 7,000
Wages Payable 4,000
Total Liabilities P 61,000

Owner’s Equity

Vic Castro, Capital 313,800

Total Liabilities and Owner’s Equity P 374,800

Illustration 1-5 Statement of Financial Position-Service Business-Single Proprietorship

The Green Valley Merchandising

Income Statement
For the Year Ended December 31, 2019

Sales P 457,500
Less: Sales Returns and Allowances P 5,950
Sales Discounts 3,550 9,500
Net Sales P 448,000
Less: Cost of Goods Sold
Merchandise Inventory, January 1 P 90,000
Add: Purchases P 270,000
Add: Transportation-in 3,100
Total P 273,100
Less: Purchase Returns and
Allowances P 5,050
Purchase Discounts 2,450 7,500
Net Purchases 265,600

2
 Total Cost of Goods Available For Sale P 355,600
Less: Merchandise Inventory, December 31 98,000
Cost of Goods Sold 257,600
Gross Profit P 190,400
Add: Other Income – Rent Revenue 400
Less: Operating Expenses:
Selling Expenses:
Sales Salaries Expense P 37,625
Advertising Expense 12,500
Depreciation expense-Store Equipment 3,750
Store Supplies Expense 1,475
Miscellaneous Selling Expense 800
Total Selling Expenses P 56,150
General and Administrative Expenses:
Office Salaries Expense P 22,575
Rent Expense 13,000
Insurance Expense 2,700
Depreciation Expense-Office Equipment 1,900
Office Supplies Expense 675
Miscellaneous Administrative Expense 825
Total General and Administrative Expenses 41,675
Financial Cost 5,800
Total Expenses ( 103,625)
Net Income P 87,175

Illustration 1-6 Income Statement-Merchandising Business-Single Proprietorship

The Green Valley Merchandising

Statement of Owner’s Equity
For the Year Ended December 31, 2019

Capital, January 1 P 77,300

Add: Net Income for the year 87,175
P 164,475
Less: Drawing 20,000
Capital, December 31 P 144,475

Illustration 1-7 Statement of Owner’s Equity-Merchandising Business-

Single Proprietorship

The Green Valley Merchandising

Statement of Financial Position
December 31, 2019

Assets

3
Current Assets:
Cash P 19,000
Accounts Receivable 56,250
Merchandise Inventory 98,000
Prepaid Insurance 2,150
Store Supplies 650
Office Supplies 375
Total Current Assets P 176,425

Non-Current Assets:
Store Equipment P 66,000
Less: Accumulated Depreciation 23,900 P 42,100
Office Equipment P 25,000
Less: Accumulated Depreciation 10,500 14,500
Total Non-Current Assets 56,600
Total Assets P 233,025

Liabilities
Current Liabilities:
Accounts Payable P 33,350
Salaries Payable 2,500
Unearned Rent 200
Total Current Liabilities P 36,050

Non-Current Liabilities
Notes Payable ( due 2014) 52,500
Total Liabilities P 88,550

Capital
G. Ramos, Capital 144,475
Total Liabilities and Capital P 233,025

Illustration 1-8 Statement of Financial Position-Merchandising Business-Single Proprietorship

Yellow Corporation
Statement of Financial Position
December 31, 2019

Assets

4
Current Assets:
Cash P 150,000
Accounts Receivable, net of Allowance for
Uncollectible Accounts 380,000
Subscription Receivable 450,000
Merchandise Inventory 379,200
Prepaid Expenses 30,000
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Total Current Assets P 1,389,200

Non-Current Assets:
Equipment P 440,000
Less: Accumulated Depreciation 20,000 420,000
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Total Assets P 1,809,200

Liabilities
Current Liabilities:
Notes Payable P 200,000
Accounts Payable 360,000
Accrued Expenses 30,000
Total Current Liabilities P 590,000

Shareholders’ Equity
Contributed Capital
Ordinary Share, P 10 par, 200,000 shares
Authorized; 51,600 shares issued P 516,000
Subscribed Ordinary share, 50,000 shares 500,000
Share Premium-Ordinary 123,200
Retained Earnings 80,000
Total Shareholders’ Equity 1,219,200
Total Liabilities and Shareholders’ Equity P 1,809,200
Illustration 1-9 Statement of Financial Position-Corporation

VC Portrait
Statement of Cash Flows
For the Month Ended December 31, 2019

Cash flows from operating activities:

Collections from customers P 104,000
Payment for rent (40,000)
Purchase of supplies (30,000)
Payment for utilities (15,000)
Payment for wages __(10,000)

5
 Net cash provided by operating activities P 9,000
Cash flows from investing activities:
Purchase of office equipment ( P 50,000)
Purchase of photography equipment __(50,000)
Net cash used in investing activity (100,000)
Cash flows from financing activities:
Investment by the owner P 300,000
Withdrawals by the owner __(20,000)
Net cash provided by financing activities ___280,000
Net increase in cash P 189,000
Cash balance, December 1, 2015 -
Cash balance, December 31, 2015 P 189,000
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Illustration 1-10 Statement of Cash Flows