Microsoft Accounting Express 2009; Performance Task

ABC Co., a service-oriented entity and a VAT-registered entity, had the following accounts on its
balance sheet at the end of the calendar year period ended December 31, 2020:

ASSETS
Cash 2,357,200.23
Accounts receivable 536,421.89
Deferred input tax carry-over 36,125.56
Deferred MCIT charges 23,125.65
Property and equipment 32,258,632.52
Less: Accumulated depreciation (2,541,652.21)
TOTAL ASSETS 32,669,853.64

LIABILITIES AND EQUITY

Accounts payable 324,852.64
Income tax payable 32,850.21
Loans payable 15,000,000.00
Total liabilities 15,357,702.85
Outstanding capital stock 8,000,000.00
Retained earnings – appropriated 7,800,000.00
Retained earnings - unappropriated 1,512,150.79
Total equity 17,312,150.79
TOTAL LIABILITIES AND EQUITY 32,669,853.64

For the first month of 2021, the company has the following transactions:

Jan 3 The company received service fee amounting 754,230.22 from clients. All of the
company’s clients are withholding tax agents. The gross amount of services is
767,943.50.

Jan 13 The company purchased a total amount 321,526.31. 75% of which are purchased from
VAT-registered entities while the rest are not qualified for input tax credit. 50% of these
purchases are only paid. Utilities accounted for the 25% non-VAT purchases.
Telecommunications accounted as the 50% of the 75% of the VATable transactions.
The rest is supplies.

Jan 30 The bank statement shows a debit charge amounting to 81,250. This is the monthly
interest auto-debit payment from the related loans payable. An additional 5% of this
amount which represents the gross receipts tax (GRT) is likewise debited from the
company’s account.

Jan 30 The entity paid the monthly salaries of the employees in the amount of 102,500, net of
withholding tax and employee’s share in the mandatory contributions. The total
premiums payable is 18,700 in which 9,700 is the share of the employer. The withheld
tax from compensation amounts to 8,500.

Jan 31 The entity recorded a monthly depreciation of 179,214.63.