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For the past several years, John Addams has operated a part-time business from his home. As of April 1,
2018, John decided to move to rented quarters and to operate the business, which was to be known as
Addams & Family Inc., on a full-time basis. Adams & Family entered into the following transactions
during April:

April 4 The following assets were received from John Addams: cash P10,000; accounts
receivable P1,500; supplies P1,250: and office equipment P7,500. There were no
liabilities received.
April 4 Paid three months’ rent on a lease rental contract, P4,500
April 4 Paid the premium on property and casualty insurance policies for the year, P1,800
April 6 Received cash from clients as an advance payment for services to be provided, P3,000
April 7 Purchased additional office furniture on account from Morrilton Company, P1,800
April 8 Received cash from clients on account P800
April 11 Paid cash for newspaper advertisement, P120

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April 12 Paid Morrilton Company P800, for debt incurred on April 7

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April 15 Recorded services provided on account for the period April 4-15, P2,250

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April 15 Paid part-time receptionist for two weeks’ salary, P400
April 15 Recorded cash from cash clients for fees earned April 4-15, P3,175

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April 18
April 22 rs e
Paid cash for supplies, P750
Recorded services provided on account for April 18-22, P1,100
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April 22 Recorded cash from cash clients for fees earned April 18-22, P1,850
April 25 Received cash from clients on account, P1,600
April 27 Paid part-time receptionist for two weeks’ salary, P400
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April 28 Paid telephone bill for April, P130

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April 29 Paid electric bill for April, P200

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April 29 Recorded cash from cash clients for fees earned April 25-29, P2,050
April 29 Recorded services provided on account for April 25-29, P1,000
April 29 John received P4,500 from the company as his salary
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Adjustments:

a. Insurance expired in April, P150

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b. Supplies on hand April 29, P1,020

c. Depreciation for the office equipment in April, P500
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d. Accrued receptionist salary on April 30, P20

e. Rent expired in April, P1,500
f. Earned P2,000 of services that were previously paid for on 4/6
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 Weddings “R” Us

Esterlina Gevera is a social entrepreneur from the South. She is into a lot of interesting causes.
Her fine taste is preeminent such that she is considered an authority in planning weddings. Upon the
advice and prodding of an esteemed colleague, Gloria Detoya, Gevera decided to organize her
wedding consultancy.

May 1 Gevera invested P250,000 into this entity

May 1 Rented office space and paid two months’ rent in advance, P8,000
May 2 Gevera issued a promissory note for a P210,000 loan from Metrobank. This availment
will beused for the acquisition of a service vehicle. The note carries a 20% interest per
annum. The arrangement with the bank is that both the interest and the principal are
payable in full in one year.
May 4 Acquired service vehicle for P420,000
May 4 Paid Prudential Guarantee and Assurance, Inc. P14,400 for a one-year comprehensive
insurance coverage on the service vehicle

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May 5 Acquired office equipment from Fair and Square Emporium for P60,000; paying P15,000
in cash and the balance next month.

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May 8 Purchased supplies on credit for P18,000 from San Jose Merchandising
May 9 Paid San Jose Merchandising P10,000 of the amount owed

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May 10 Coordinated and finalized simple bridal arrangement for three couples and collected
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fees P8,800 per couple. Services include prospecting and selecting the church and
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reception location, couturier, caterer, car service, flowers, souvenirs and invitations.
May 13 Paid salaries, P6,600. The entity pays salaries every two Saturdays.
May 15 The entity is earning additional revenues by referring consulting clients to friendly
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hotels, caterers, printers, and couturiers. Received P10,000 advance fees for three
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clients referred.
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May 19 Coordinated and finalized elaborate bridal arrangements for three couples and billed
fees of P12,000 per couple.
May 25 Gevera withdraw P14,000 for personal expenses
May 27 Paid salaries, P7,200
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May 30 Received the ICC-BayanTel telephone bill, P1,400

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May 30 Received P24,000 from two clients for services billed last May 19
May 31 Settled the electricity bill of P3,000 for the month
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Adjustments:
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a. By May 31, one-half of the prepaid rent on May 1 expired

b. The one year prepaid insurance expired for the month of May
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c. Supplies on hand, P15,000

d. Depreciation of service vehicle with a salvage value of P84,000 and will last for seven years
e. Office equipment will have a useful life of five years and will be worthless at that time
f. One of the three couples who paid in advance on May 15 has already taken their marriage vows
and as a result the amount of P4,000 has been realized

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 g. The office assistant and the account executive were paid salaries on May 13 and 27. At the
month-end, the employees have worked for three days (May 29,30,31) beyond the last pay
period. Each of the employees’ salary rate is P7,800 a month or P300 per day
h. Expired interest for the month from the transaction on May 2
i. Earned but unbilled Consulting revenue for P5,300

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