The inexperienced bookkeeper of BIGHIT Co.

committed errors in recording the following transactions:

1. The owner’s investments to the business consisting of ₱5,000 cash and ₱35,500 in equipment were
recorded as debit to Depreciation expense of ₱40,500 and a credit to Owner’s equity of ₱40,500.
2. A ₱1,000 insurance premium paid in advance was debited to Prepaid Rent and credited to Cash.
3. A cash purchase of equipment worth ₱5,500 was debited to Equipment and credited to Accounts receivable.
4. A ₱200 payment of accounts payable was recorded as a debit to Cash and a credit to Accounts Receivable.
5. A ₱1,500 cash withdrawal of the owner from the business was debited to Cash and credited to the Owner’s equit

Instructions: Prepare the correct entries (not correcting entries) in journal provided below.

JOURNAL
DATE ACCOUNT TITLES DEBIT CREDIT
1
 lowing transactions:
in equipment were
wner’s equity of ₱40,500.
redited to Cash.
dited to Accounts receivable.
dit to Accounts Receivable.
and credited to the Owner’s equity account.
On January 2, 20x1, Jin, an attorney, opened a law office as Bangtan Law Office, a professional services company. Th

1. Jin invested ₱20,000 cash and ₱13,200 worth of office equipment in the business. (Use ‘Office equipment’ accou
2. Paid the current month’s rent of ₱2,500. (Use ‘Rent expense’ account)
3. Paid ₱1,000 for office supplies. (Use ‘Supplies expense’ account)
4. Collected legal fees of ₱19,600. (Use ‘Service fees’ account)
5. Paid secretary a salary of ₱1,100. 
6. Purchased ₱200 worth of office supplies on account. (Use ‘Accounts payable’ account)
7. Bought a vehicle for business use (Use ‘Transportation equipment’ account). The cost of the vehicle is ₱13,000. T
8. Jin withdrew ₱5,000 cash from the business.
9. Paid ₱800 for auto repairs and maintenance.
10. Received a ₱240 telephone bill. The bill is not yet paid. (Use ‘Communications expense’ and ‘Accounts payable’
11. Paid the ₱240 telephone bill.
12. Paid premiums of ₱1,700 on property insurance. (Use ‘Insurance expense’ account)
13. Paid ₱2,000 on accounts payable.
14. Paid ₱5,000 cash for books for the law library. (Use ‘Books’ account)
15. Paid ₱500 cash for janitor service. (Use ‘Janitorial expense’ account)

Instructions: Using the forms provided below:

1. Provide the journal entries for the transactions. (You may omit narrative descriptions for the entries.)
2. Post the entries using T-accounts.
3. Prepare the January 31, 20x1 trial balance.
fessional services company. The following transactions were completed during the month.

Use ‘Office equipment’ account)

ost of the vehicle is ₱13,000. The business paid ₱2,600 down payment and charged the balance on account. (Use ‘Accounts payable’ accou

ense’ and ‘Accounts payable’ account)

ns for the entries.)

(Use ‘Accounts payable’ account)
 JOURNAL
DATE ACCOUNT TITLES DEBIT CREDIT
Cash 20,000
(a) Office equipment 13,200
        Owner’s equity 33,200
Rent expense  2,500
(b)
       Cash 2,500
Supplies expense 1,000
(c)
       Cash 1,000
Cash 19,600
(d)
        Service fees 19,600
Salaries expense 1,100
(e)
         Cash 1,100
Supplies expense 200
(f)
       Accounts payable 200
Transportation equipment 13,000
(g)        Cash 2,600
       Accounts payable 10,400
Owner’s drawings 5,000
(h)
       Cash 5,000
Repairs and maintenance 800
(i)
       Cash 800
Communications expense 240
(j)
       Accounts payable 240
Accounts payable 240
(k)
       Cash 240
Insurance expense 1,700
(l)
        Cash 1,700
Accounts payable 2,000
(m)
       Cash 2,000
Books  5,000
(n)
       Cash 5,000
Janitorial expense 500
(o)
       Cash 500
 GENERAL LEDGER
ASSETS 
Cash  Office equipment 
(a) 20,000 (a) 13,200
(d) 19,600 2,500 (b)
1,000 (c)
1,100 (e) Bal. 13,200
2,600 (g)
5,000 (h)
800 (i)
240 (k)
1,700 (l)
2,000 (m)
5,000 (n)
500 (o)
Bal. 17,160

                Transportation equipment  Books

(g) 13,000 (n) 5,000

Bal. 13,000 Bal. 5,000

LIABILITIES
Accounts payable 
200 (f)
10,400 (g)
(k) 240 240 (j)
(m) 2,000

8,600 Bal.
GENERAL LEDGER
EQUITY 
Owner’s equity  Owner’s drawings 
33,200 (a) (h) 5,000

33,200 Bal. Bal. 5,000

INCOME
                          Service fees
19,600 (d)

19,600 Bal.

EXPENSES
Rent expense  Supplies expense 
(b) 2,500 (c) 1,000
(f) 200
Bal. 2,500 Bal. 1,200

                          Salaries expense  Repairs & maintenance

(e) 1,000 (i) 800

Bal. 1,100 Bal. 800

Communications expense Insurance expense

(j) 240 (l) 1,700

Bal. 240 Bal. 1,700

Janitorial expense
(o) 500

Bal. 500
 Bangtan Law Office
Trial Balance
January 31, 20x1

Accounts Debits  Credits 

Cash  17,160
Office equipment  13,200
Transportation equipment  13,000
Books  5,000
Accounts payable  8,600
Owner's equity  33,200
Owner's drawings 5,000
Service fees 19,600
Rent expense 2,500
Supplies expense 1,200
Salaries expense 1,100
Repairs and maintenance 800
Communications expense 240
Insurance expense 1,700
Janitorial expense 500
Totals  61,400 61,400