ACTIVITY 6

The Adjustment and Worksheet

Name: Tacla, John Erron Vanguardia Student Number: MMC2022-00514

(Last Name, Given Name, Middle Name)
Course/Year/Section: BSTM-1A Mobile Number: 09658068383

JAYSON RIVERO PAYAPAG TRADING CO.

TRIAL BALANCE
DECEMBER 31, 2013

Debit Credit
Cash ₱ 500,000
Accounts Receivable 60,000
Notes Receivable 10,000
Allowance for Bad Debts ₱ 40,000
Inventory, Jan 1 10,000
Land 1,600,000
Building 2,500,000
Accumulated Depreciation-Building 240,000
Furniture & Fixtures 120,000
Accumulated Depreciation- F&F 40,000
Prepaid Insurance 60,000
Accounts Payable 660,000
Mortgage Payable 500,000
Unearned Rent Income 33,000
Jayson Payapag, Capital 3,400,000
Jayson Payapag, Drawing 10,000
Sales 100,000
Sales Return & Allowances 5,000
Purchases 94,800
Freight in 30,000
Advertising Expense 3,000
Salaries & Wages 4,000
Interest Expense 1,200
Miscellaneous Expense 5,000
₱ 5,013,000 ₱ 5,013,000

Required:
Prepare an adjusting entry for the following information
1. Estimated doubtful accounts is 2% of net sales.
2. The useful life of a building is 10 years with a residual value of ₱100, 000 while the Furniture & Fixtures have 5 years useful
life having a residual value of ₱20,000. The last depreciation has taken place on December 31, 2012. The building was
bought on January 1, 2012 while the furniture & fixtures were on January 1, 2011.
3. The accumulated expired portion for 2013 of the insurance is ₱40,000
4. Interest of 10% is payable every October 1 on the mortgage payable.
5. Salaries of employees accrued on December 31, 2013 amounting to ₱12,000
6. Prepaid advertising on December 31, 2013 is ₱1,000.
7. Office supplies bought during 2013 were charged to Miscellaneous Expense, ₱4,500.
8. ₱22,000 of cash received from advance payment of tenant have already been earned.
9. Accrued interest on notes receivable, ₱5,000
10. Merchandise inventory, December 31, 2013, ₱ 60,000
 Unadjusted Trial Balance Adjustments Adjusted Trial Balance Income Statement Balance Sheet
Particulars
Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit
Cash ₱ 500,000 8. 22,000 7. 500 ₱ 521,500 ₱ 521,500
Accounts Receivable 60,000 8. 22,000 38,000 38,000
Notes Receivable 10,000 10,000 10,000
Allowance for Bad Debts 40,000 40,000 40,000
Inventory, Jan 1 10,000 10,000 10,000
Land 1,600,000 1,600,000 1,600,000
Building 2,500,000 2,500,000 2,500,000
Accumulated 240,000 2. 14,000 254,000 254,000
Depreciation-Building
Furniture & Fixtures 120,000 120,000 120,000
Accumulated 40,000 2. 8,000 48,000 48,000
Depreciation- F&F
Prepaid Insurance 60,000 3. 20,000 80,000 80,000
Accounts Payable 660,000 660,000 660,000
Mortgage Payable 500,000 500,000 500,000
Unearned Rent Income 33,000 33,000 33,000
Jayson Payapag, Capital 3,400,000 3,400,000 3,400,000
Jayson Payapag, 10,000 10,000 10,000
Drawing
Sales 100,000 100,000 100,000
Sales Return & 5,000 5,000 5,000
Allowances
Purchases 94,800 94,800 94,800
Freight in 30,000 30,000 30,000
Advertising Expense 3,000 6. 1,000 4,000 4,000
Salaries & Wages 4,000 5. 12,000 16,000 16,000
Interest Expense 1,200 4. 12,500 13,700 13,700
Miscellaneous Expense 5,000 7. 500 5,500 5,500
TOTAL ₱5,013,000 ₱5,013,000
Doubtful Account 1. 1,900 1,900 1,900
Expenses
Allowance for Doubtful 1. 1,900 1,900 1,900
Accounts
Depreciation Expense 2. 22,000 22,000 22,000
Accumulated 3. 20,000 20,000 20,000
Depreciation
Interest Payable 4. 12,500 12,500 12,500
Salaries Payable 5. 12,000 12,000 12,000
Advertising Payable 6. 1,000 1,000 1,000
Interest Receivable 9. 5,000 5,000 5,000
Interest Revenue 9. 5,000 5,000 5,000
Service Revenue 10. 60,000 60,000 60,000
Merchandize Inventory 10. 60,000 60,000 60,000
TOTAL ₱156,900 ₱156,900 ₱5,147,400 ₱5,147,500 ₱47,100 ₱5,082,400
Net Income(Loss) 17,900 17,900
Balances ₱65,000 ₱65,000 ₱5,100,300 ₱5,100,300