TYPES OF MAJOR

ACCOUNTS
PREPARED BY: PROF. JERICKO LIAN DEL ROSARIO
ACCOUNTING PROCESS:

A J P
POSTING
U
ANALYZING JOURNALIZING Unadjusted Trial Balance

A
Adjusted Trial Balance
F
Financial Statements
C
Closing Entries
P
Post-closing Trial Balance

R
Reversing Entries
 ASSETS LIABILITIES CAPITAL INCOME EXPENSES

• Cash • Accounts payable • Capital • Service Revenue • Salaries Expense

• Accounts • Notes payable • Withdrawal • Sales • Utilities Expense
Receivable
• Unearned • Rent Expense
• Supplies Revenue
• Insurance Expense
• Prepaid Rent
• Equipment
JOURNAL ENTRIES
PREPARED BY: PROF. JERICKO LIAN DEL ROSARIO
JOURNALIZING ENTRIES

• The process of recording transactions

• Assumes Accrual and Business entity concept
• Applies rules of debit and credit
RULES OF DEBITS AND CREDITS

INCREASE DECREASE

ASSETS A Dr Cr

LIABILITIES L Cr Dr

CAPITAL C Cr Dr

INCOME I Cr Dr

EXPENSE E Dr Cr

Normal balance
 L C I
A
E

L C I
A
E

DEBIT CREDIT
 TRANSACTIONS:

a) Lian, the owner of the Easy Gadgets Co., invested P100,000 cash in the (+Cash, +Capital)
business.
Cash 100,000
Lian, Capital 100,000

b) Purchased equipment and supplies amounting to P30,000 and P5,000 (+Equip, +Supplies, -Cash, +A/P)
respectively. Half of the supplies purchased is on account.
Equipment 30,000
Supplies 5,000
Cash 32,500
Accounts payable 2,500

c) Paid for the rent in advance, P10,000 (+Prep Rent, -Cash)

Prepaid Rent 10,000
Cash 10,000
TRANSACTIONS:

d.) Provided services on account, P15,000 (+A/R, +S/R)

Accounts Receivable 15,000
Service Revenue 15,000

e.) Paid the salary of an employee, P7,500 (+Exp, +Cash)

Salaries Expense 7,500
Cash 7,500

f.) Lian withdrew P2,000 cash for personal use. (+Withdrawal, -Cash)
Lian, Withdrawal 2,000
Cash 2,000
TRANSACTIONS

g,) Paid P1,500 of the outstanding liability (transaction b) (-A/P, -Cash)

Accounts Payable 1,500
Cash 1,500

h.) Received P4,500 from customers on account. (+Cash, -A/R)

Cash 4,500
Accounts Receivable 4,500
POSTING TO THE LEDGER

• The process of transferring the records from journal to ledger

• T-account is a representation of the ledger
 Accounts Supplies Prepaid
CASH 100,000 Receivable Rent
LIAN, CAPITAL 100,000
15,000 4,500 5,000 10,000
EQUIPMENT 30,000
SUPPLIES 5,000 10,500
CASH 32,500
ACCOUNTS PAYABLE 2,500

PREPAID RENT 10,000 Cash

CASH 10,000 Accounts
Equipment Lian, Capital
payable
ACCOUNTS RECEIVABLE 15,000 100,000 32,500
SERVICE REVENUE 15,000 1,500 2,500 100,000
30,000 4,500 10,000
SALARIES EXPENSE 7,500 7,500
1,000
CASH 7,500 2,000
1,500
LIAN, WITHDRAWAL 2,000 104,500 53,500
CASH 2,000
51,000
Lian, Service Salaries
ACCOUNTS PAYABLE 1,500
CASH 1,500 Withdrawals Revenue Expense

2,000 15,000 7,500

CASH 4,500
ACC. RECEIVABLE 4,500
UNADJUSTED TRIAL BALANCE

• A listing of all the ledger accounts and their balances summarized to prove the equality of
debit and credit.
 EASY GADGETS CO.
UNADJUSTED TRIAL BALANCE
DECEMBER 31, 2020

DEBIT CREDIT
Cash P 51,000
Accounts Receivable 10,500
Supplies 5,000
Prepaid Rent 10,000
Equipment 30,000
Accounts Payable P 1,000
Lian, Capital 100,000
Lian, Withdrawals 2,000
Service Revenue 15,000
Salaries Expense 7,500 _________
TOTAL P 116,000 P 116,000