ACTIVITY 6

The Adjustment and Worksheet

Name: ___________________________________________ Student Number: _______________________

(Last Name, Given Name, Middle Name)
Course/Year/Section: _____________________________ Mobile Number: ________________________

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 and worksheet 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