Completing the Accounting Cycle

Presented below together with the account numbers and balances is the trial balance of Blesida Gomez
Catering Services at the end of November 2019.

Accounts Debit Credit

101 Cash 700,000
102 Accounts receivable 196,000
103 Prepaid Insurance 60,000
104 Kitchen Supplies 10,000
201 Kitchen Equipment 240,000
301 Accumulated Depreciation - 50,000
Kitchen Equipment
202 Building 1,000,000
301 Accum. Dep’n - Building 200,000
202 Vehicle 600,000
401 Accounts Payable 138,000
402 Notes Payable 180,000
402 Mortgage Payable 400,000
600 Gomez, Withdrawals 100,000
601 Gomez, Capital 800,000
701 Catering Revenues 1720,000
801 Salaries Expense 370,000
802 Rent Expense 120,000
803 Transportation Expense 10,000
804 Utilities Expense 16,000
805 Miscellaneous Expenses 30,000
806 Taxes and Licenses 36,000
Totals P3,488,000 P3,488,000

The following are the transactions during the month of December

Dec. 1 Paid for one year advertisement, P30,000

3 Rendered catering services to clients on cash, P180,000, on account, P250,00
5 Paid salaries of the employees, P54,000
7 Paid accounts to some suppliers, P20,000
7 Cash receipts from dine in clients for the months, P120,000.
9 Made catering services to a client, on account, P50,000
9 Paid salaries of the employees, P6,000
14 Received utility bills for the month, P25,000
16 Paid annual amortization of mortgage, P80,000
17 Acquire kitchen supplies on account, P15,000
20 Paid repairs on the building , P23,000
21 Paid for taxes, P12,000
22 Collected accounts from client P120,000.
 26 Received P50,000 from clients for catering services to be rendered on Jan 20, 2020.
30 Paid all utility bills.
30 Made withdrawal of P50,000 for personal use.

Additional Information:

1. The insurance covers one year starting March 1, 2019.

2. The notes payable bears an interest of 4% per annum. The note was dated Aug 1, 2019.
3. P4,000 of the kitchen supplies remains unused at the end of the year.
4. Taxes that remained unpaid is P5,000
5. The advertisement covers one year starting the day of payment.
6. The expected uncollectible accounts is 5% of the total accounts receivable.
7. The building a useful life of 20 years with a salvage value of P200,000
8. The vehicle was newly acquired last July 1 with an estimated useful life of 15 years with a
salvage value of P100,000
9. The kitchen equipment has an estimated life of 15 years with no salvage value.

Required: Prepare the following for the month of December.

1. Record the transactions.

2. Post the transactions to the ledger using T account
3. Prepare the Trial Balance.
4. Prepare the adjusting entries
5. Prepare the financial statements.
6. Prepare the closing entries and post closing trial balance.