College of Business and Accountancy

Problem I.

The BSA-WS Co. buys and sell agricultural products. In November 2019, the following
merchandise transactions were incurred.

a. Merchandise purchase on credit P 300,000.

Purchase 300,000
Account payable 300,000

b. Merchandise sold on account P 560,000.

Account receivable 560,000
Sales 560,000

c. Cash purchases P 120,000.

Purchases 120,000
Cash 120,000

d. Cash sales P 310,000.

Cash 310,000
Sales 310,000

e. Defective goods returned to cash supplies P 10,000.

Sales return and Allowances 10,000
Account receivable 10,000

f. Defective goods returned to account supplier P 8,000.

Sales Discount 8,000
Account Receivable 8,000

g. Credit memo received by the seller from cash customers P 12,000.

Cash 12,000
Sales 12,000

h. Credit memo received by the seller from credit customers P 5,000.

Account Receivable 5,000
Sales 5,000

i. Payment to merchandise creditors within the discount, P 290,000 after deducting a

discount of P 10,000.
Account Payable 300,000
Purchase Discount 10,000
Cash 290,000

j. Collections from credit customers of P 400,000 less discount of P 8,000.

Cash 392,000
Sales Discount 8,000
Account Receivable 400,000
Requirements: Prepare journal entries after each transaction.

Problem II.

Compute the missing amounts

Case 1 Case 2 Case 3 Case 4

Sales 1,244,325 2,468,540 1,425,360 1,302,410

Cost of sales 825,450 1,727,970 991,490 875,890

Gross Profit 2,069,775 4,196,510 433,870 426,520

Operating Expense 245,330 3,968,175 301,320 301,320

Net Profit 1,824,445 210,335 132,550 125,200

Case 5 Case 6 Case 7 Case 8

Inventory beginning 125,750 87,985 55,780 68,990

Purchases 775,350 822,500 514,740 695,220

Total Goods Available for Sale 901,100 901,485 570,520 764,210

Inventory Ending 87,755 151,150 45,230 91,245

Cost of Sales 988,855 750,335 615,750 855,455

Case 9 Case 10

Sales 125,000 100%

Beginning Inventory 22,000 10%

Purchases 76,000 45%

Ending Inventory 24,000 15%

Cost of Sales 74,000 50%

Gross Profit 51,000 60%

Operating Expenses 39,000 10%

Net Income 12,000 40%