In October 1, 2020 Tolentino Trading Corporation located in San Pablo City, Laguna was established Presented below is the

he Post – Closing Trial Balance of Tolentino Trading for the month ended, April
as corporation engaged in buying and selling of merchandise under the name Tolentino Trading. 30, 2021.
The Corporation prepares a monthly financial statement, hence, adjusting and closing entries are
made at the end of each month. The Chart of Accounts is as follows: Cash ₱ 324,020.00
Accounts Receivable 27,000.00
110 Cash Merchandise Inventory 65,000.00
120 Accounts Receivable Input VAT 15,000.00
130 Merchandise Inventory Store Equipment 120,000.00
140 Input VAT Accumulated Depreciation-Store Equipment ₱ 5,000.00
150 Store Equipment Office Equipment 60,000.00
155 Accumulated Depreciation – Store Equipment Accumulated Depreciation-Office Equipment 2,500.00
160 Office Equipment Accounts Payable 12,000.00
165 Accumulated Depreciation – Office Equipment Withholding Taxes Payable 1,100.00
210 Accounts Payable Expanded Withholding Tax Payable 800.00
220 Withholding Tax Payable SSS, PhilHealth and Pag-ibig Payable 3,900.00
230 Expanded Withholding Tax Payable Utilities Payable 5,720.00
240 SSS, PhilHealth and Pag-ibig Contributions Payable Ordinary Share Capital ₱ 100 par 400,000.00
250 Utilities Payable Retained Earnings 180,000.00
260 Output VAT
270 Cash Dividends Payable Required:
310 Ordinary Share Capital ₱ 100 par 1. Transfer the Post-Closing Trial Balance amounts to its corresponding account in general ledger as
320 Retained Earnings beginning balance.
330 Income Summary 2. Journalize and post the transactions for the month of May.
410 Sales 3. Prepare Trial Balance directly at a worksheet. Complete the worksheet.
420 Sales Returns and Allowances 4. Prepare the financial statement (Statement of Performance, Statement of Financial Position and
430 Sales Discount Cash Flows).
610 Salaries Expense 5. Journalize and post the adjusting entry.
620 SSS, PhilHealth and Pag-ibig Contribution 6. Journalize and post the closing entry.
630 Rent Expense 7. Prepare the Post-Closing Trial Balance for the month of May.
640 Utilities Expense
650 Supplies Expense Additional Information:
660 Transportation Expense a. Depreciation expense of long-lived assets is 10% of the asset cost per annum.
670 Depreciation Expense – Store Equipment b. Purchase of supplies is directly recorded as Supplies Expense
680 Depreciation Expense – Office Equipment c. Merchandise inventory at May 31, is ₱63, 736.00
690 Miscellaneous Expense
 PURCHASES JOURNAL
Date Invoice No. Accounts Debited P.R. Purchases debit Input VAT Accounts Payable
2021 Debit credit
May 4 67654 Tan General Merchandise Terms: 2/10,n/30  21,560 2,940 24,500
8 52231 Marcelo Trading Terms: 2/10, n/30  20,240 2,760 23,000
23 56781 Llagas Merchandising Terms: 2/10,n/30  16,720 2,280 19,000
28 43229 Morales Merchant Terms: 2/10,n/30  18,480 2,520 21,000


TOTAL ₱77,000 ₱ 10,500 ₱ 87,500

(510) (140) (210)

SALES JOURNAL
Date Invoice Accounts Debited P.R. Sales Output VAT Accounts Receivable
2021 No. credit credit debit
May 1 1603 E. Hernandez Terms: 2/10,n/30  24,640 3,360 28,000
6 1604 H. Barias Terms: 2/10,n/30  22,880 3,120 26,000
9 1605 W. Corcega Terms: 2/10, n/30  27,280 3,720 31,000
17 1606 I. Tapalla Terms: 2/10, n/30  23,320 3,180 26,500
23 1607 F. Pagcu Terms: 2/10, n/30  21,120 2,880 24,000

 ₱ 119,240 ₱ 16,260 ₱ 135,500
TOTAL (410) (260) (120)
 CASH RECEIPT JOURNAL
Date O.R INVOICE Accounts Debited P.R. Accounts Sales Output Sales Cash
No. No. Receivable VAT Discount
2021 credit credit credit debit debit
May 5 1521 1600 J. Corpus  27,000 540 26,460
5 1522 R. Oribello  30,800 4,200 35,000
15 1523 1604 H. Barias  26,000 520 25,480
23 1524 E. Hernandez  24,640 3,360 28,000
28 1525 I. Tapalla  23,320 3,180 26,500



TOTAL ₱53,000 ₱ 78,760 ₱ 10,740 ₱ 1,060 ₱ 141,440
(120) (410) (260) (430) (110)
 CASH DISBURSEMENT JOURNAL
Date Check Check Accounts Debited P.R Sundry Salaries SSS, PH, Withholding Accounts Purchase Cash
Vouch No. Expense Pagibig Tax Payable Payable Discounts
er No. Debit/ Debit Payable Debit
(credit) Debit Credit debit credit credit
2021 (Credit)
May 2 2116 10021 Purchases 510 13,200
Input VAT 140 1,800 15,000
3 2117 10022 Tan General Merchandisw  12,000 240 11,760
3 2118 10023 Supplies Expense 650 3,080
Input Vat 140 420 3,500
4 2119 10024 Sales Returns and Allowances 420 2,640
Output VAT 260 360 3,000
12 2120 10025 SSS, PhilHealth and Pag-ibig  3,900 3,900
13 2121 10026 Utilities Payable-Water 250 520 520
14 2122 10027 BIR-Expanded Withholding Tax 230 800 1,100 1,900
15 2123 10028 Payroll (May 1-15)  26,000 (1,300) 24,700
17 2124 10029 Utilities Payable-Electricity 250 5,200 5,200
18 2125 10030 Marcelo Trading  23,000 460 22,540
24 2126 10031 Purchases 510 8,800
Input VAT 140 1,200 10,000
27 2127 10032 Rent Expense 630 18,000 18,000
31 2128 10034 Payroll (May 16-31)  26,000 (1,300) 24,700

TOTAL ₱ 56,020 ₱ 52,000 ₱ 2,600 ₱ (200) ₱ 35,000 ₱700 ₱ 144,720

 (610) (240) (220) (210) (530) (110)
 GENERAL JOURNAL
Page 1
Date PARTICULARS P.R Debit Credit
2021
May 4 Cash 110 2,300
Purchases Returns and Allowances 2,024
Input VAT 276
To record the refund

27 Sales Returns and Allowances 1,848

Output VAT 252
Accounts Receivable 2,100
To record the goods returns from W. Corcega

27 Accounts Payable 2,500

Purchases Returns and Allowances 2,200
Input VAT 300
To record the refund to Llagas Merchandising
 General Journal Adjusting Entries Page 2
Date PARTICULARS P.R Debit Credit
2021
May 31 Utilities Expense-Water 640 ₱ 450
Utilities Payable- Water 250 ₱ 450
To record water usage (Month of May)

31 Utilities Expense-Electricity 640 2,100

Utilities Payable-Electricity 250 2,100
To record electricity usage (Month of May)

31 SSS, PhilHealth and Pag-ibig Contributions 620 2,600

SSS, PhilHealth and Pag-ibig Payable 240 2,600
To record employer’s share

31 Retaining Earnings 320 80,000

Cash Dividends Payable 270 80,000
To record declaration of dividends

31 Depreciation Expense-Store Equipment 670 1,000

Accumulated Depreciation-Store Equipment 155 1,000
To record the depreciation of store equipment

31 Depreciation Expense-Office Equipment 680 500

Accumulated Depreciation-Office Equipment 165 500
To record the depreciation of office equipment
 GENERAL JOURNAL
Page 3
Date PARTICULARS P.R Debit Credit
2021
May 31 Merchandise Inventory, May 31, 2021 130 ₱ 63,736
Sales 410 198,000
Purchases Returns and Allowances 520 4,224
Purchase Discounts 530 700
Income Summary 330 ₱266,660
To establish ending inventory nominal accounts with credit balances

31 Income Summary 330 249,278

Merchandise Inventory, May 1, 2021 130 65,000
Sales Returns and Allowances 420 4,488
Sales Discount 430 1,060
Purchases 510 99,000
Salaries Expense 610 52,000
Rent Expense 630 18,000
Supplies Expense 650 3,080
SSS, PhilHealth and Pag-ibig Contributions 620 2,600
Utilities Expense 640 2,550
Depreciation Expense-Store Equipment 670 1,000
Depreciation Expense-Office Equipment 680 500
To close beginning inventory nominal accounts with debit balances

31 Income Summary 330 17,382

Retained Earnings 320 17,382
To close net income to retained earnings
 GENERAL LEDGER
101 Cash 150 Store Equipment
Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 1 Beginning  324,020 324,020 May 1 Beginning  120,000 120,000
31 Cash Receipt Journal CRJ1 141,440 465,460
31 Cash Disbursement Journal CDJ1 144,720 320,740
31 Refund GJ1 2,300 323,040

120 Accounts Receivable 155 Accumulated Depreciation-Store Equipment

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 1 Beginning  27,000 27,000 May 1 Beginning  5,000 5,000
31 Sales Journal SJ1 135,500 162,500 31 Adjusting GJ2 1,000 6,000
31 Cash Receipt Journal CRJ1 53,000 109,500
31 Returns of Goods GJ1 2,100 107,400

130 Merchandise Inventory 160 Office Equipment

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 1 Beginning  65,000 65,000 May 1 Beginning  60,000 60,000
31 Closing GJ3 63,736 128,736
31 Closing GJ3 65,000 63,736

140 Input VAT 165 Accumulated Depreciation-Office Equipment

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 1 Beginning  15,000 15,000 May 1 Beginning  2,500 2,500
31 Purchases Journal PJ1 10,500 25,500 31 Adjusting GJ2 500 3,000
31 Cash Disbursement Journal CDJ1 3,420 28,920
31 General Journal GJ1 576 28,344
210 Accounts Payable 250 Utilities Payable
Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 1 Beginning  12,000 12,000 May 1 Beginning  5,720 5,720
27 General Journal GJ1 2,500 9,500 13 Paid water bill (April) CDJ1 520 5,200
31 Purchases Journal PJ1 87,500 97,000 17 Paid electricity (April) CDJ1 5,200 0
31 Cash Disbursement Journal CDJ1 35,000 62,000 31 Water usage (May) GJ2 450 450
31 Electricity usage (May) GJ2 2,100 2,550
220 Withholding Tax Payable 260 Output VAT
Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 1 Beginning  1,100 1,100 May 4 Cash Disbursement Journal CDJ1 360 360
31 Cash Disbursement Journal CDJ1 200 1,300 27 General Journal GJ1 252 612
31 Sales Journal SJ1 16,260 15,648
31 Cash Receipt Journal CRJ1 10,740 26,388

230 Expanded Withholding Tax Payable 270 Cash Dividends Payable

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 1 Beginning  800 800 May 31 Declaration of Dividends GJ2 80,000 80,000
14 Cash Disbursement Journal CDJ1 800 0

240 SSS, PH, and Pagibig Payable

Date Description P.R Debit Credit Balance 310 Ordinary Share Capital ₱ 100,000
May 1 Beginning  3,900 3,900 Date Description P.R Debit Credit Balance
31 Cash Disbursement Journal CDJ1 2,600 1,300 May 1 Beginning  400,000 400,000
31 Adjusting General Journal GJ2 2,600 3,900
320 Retained Earnings 430 Sales Discount
Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 1 Beginning  180,000 180,000 May 31 Cash Receipt Journal CRJ1 1,060 1,060
31 Adjusting General Journal GJ2 80,000 100,000 31 Closing GJ3 1,060 0
31 Closing GJ3 17,383 117,383

330 Income Summary 510 Purchases

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 31 Closing GJ3 266,660 266,660 May 31 Purchases Journal PJ1 77,000 77,000
31 Closing GJ3 249,278 17,382 31 Cash Disbursement Journal CDJ1 22,000 99,000
31 Closing GJ3 17,382 0 31 Closing GJ3 99,000 0

410 Sales 520 Purchases Returns and Allowances

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 31 Sales Journal SJ1 119,240 119,240 May 31 General Journal GJ1 4,224 4,224
31 Cash Receipt Journal CRJ1 78,760 198,000 31 Closing Gj3 4,224 0
31 Closing GJ3 198,000 0

420 Sales Returns and Allowances 530 Purchase Discounts

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
May 4 Cash Disbursement Journal CDJ1 2,640 2,640 May 31 Cash Disbursement Journal CDJ1 700 700
27 General Journal GJ1 1,848 4,488 31 Closing GJ3 700 0
31 Closing GJ3 4,488 0
610 Salaries Expenses
Date Description P.R Debit Credit Balance
May 31 Cash Disbursement Journal CDJ1 52,000 52,000 650 Supplies Expense
31 Closing GJ3 52,000 0 Date Description P.R Debit Credit Balance
May 3 Cash Disbursement Journal CDJ1 3,080 3,080
620 SSS, PhilHealth and Pag-Ibig Contributions 31 Closing GJ3 3,080 0
Date Description P.R Debit Credit Balance
May 31 Adjusting General Journal GJ2 2,600 2,600
31 Closing GJ3 2,600 0 660 Transportation Expense
Date Description P.R Debit Credit Balance
630 Rent Expense
Date Description P.R Debit Credit Balance
May 27 Cash Disbursement Journal CDJ1 18,000 18,000
31 Closing GJ3 18,000 0
670 Depreciation Expense – Store Equipment
640 Utilities Expense Date Description P.R Debit Credit Balance
Date Description P.R Debit Credit Balance May 31 Depreciation (Month of May) GJ2 1,000 1,000
May 31 Water Bill (May) GJ2 450 450 31 Closing GJ3 1,000 0
31 Electricity Bill (May) GJ2 2,100 2,550
31 Closing GJ3 2,550 0
680 Depreciation Expense – Office Equipment
Date Description P.R Debit Credit Balance
May 31 Depreciation (Month of May) GJ2 500 500
31 Closing GJ3 500 0 Accounts Receivable – H. Barias
Date Description P.R Debit Credit Balance
690 Miscellaneous Expense May 6 Invoice No. 1604 SJ1 26,000 26,000
Date Description P.R Debit Credit Balance 15 OR No. 1523 CRJ1 26,000 0

Accounts Receivable – W. Corcega

Date Description P.R Debit Credit Balance
SUBSIDIARY LEDGER May 9 Invoice No. 1605 SJ1 31,000 31,000
Accounts Receivable – J. Corpus 27 Returned Merchandise GJ1 2,100 28,900
Date Description P.R Debit Credit Balance
May 1 Invoice No. 1600  27,000 27,000
5 OR No. 1521 CRJ1 27,000 0 Accounts Receivable – I. Tapalla
Date Description P.R Debit Credit Balance
Accounts Receivable – E. Hernandez May 17 Invoice No. 1606 SJ1 26,500 26,500
Date Description P.R Debit Credit Balance
May 1 Invoice No. 1603 SJ1 28,000 28,000
Accounts Receivable – F. Pagcu
Date Description P.R Debit Credit Balance
May 23 Invoice No. 1607 SJ1 24,000 24,000
Accounts Payable – Morales Merchant
Date Description P.R Debit Credit Balance
May 28 Invoice No. 43229 PJ1 21,000 21,000
Accounts Payable – Tan General Merchandise
Date Description P.R Debit Credit Balance
May 1 Beginning  12,000 12,000
3 Check No. 10022 CDJ1 12,000 0 Accounts Payable –
4 Invoice no. 67654 PJ1 24,500 24,500 Date Description P.R Debit Credit Balance

Accounts Payable – Marcelo Trading

Date Description P.R Debit Credit Balance
May 8 Invoice No. 52231 PJ1 23,000 23,000
18 Check No. 10030 CDJ1 23,000 0 Accounts Payable –
Date Description P.R Debit Credit Balance
Accounts Payable – Llagas Merchandising
Date Description P.R Debit Credit Balance
May 23 Invoice No. 56781 PJ1 19,000 19,000
27 Returned of Goods GJ1 2,500 16,500
 TOLENTINO TRADING
Worksheet
For the Month Ended, May 31, 2021
Account Account Title Trial Balance Adjustment Income Statement Balance Sheet
No. Debit Credit Debit Credit Debit Credit Debit Credit
110 Cash ₱ 323,040 ₱323,040
120 Accounts Receivable 107,400 107,400
130 Merchandise Inventory 65,000 ₱65,000 ₱63,736 63,736
140 Input VAT 28,344 28,344
150 Store Equipment 120,000 120,000
155 Accumulated Depreciation-Store Equipment ₱ 5,000 ₱ 1,000 ₱ 6,000
160 Office Equipment 60,000 60,000
165 Accumulated Depreciation-Office Equipment 2,500 500 3,000
210 Accounts Payable 62,000 62,000
220 Withholding Tax Payable 1,300 1,300
240 SSS, Philhealth, and Pagibig Payable 1,300 2,600 3,900
250 Utilities Payable 0 2,550 2,550
260 Output VAT 26,388 26,388
270 Cash Dividends Payable 80,000 80,000
310 Ordinary Share Capital ₱ 100 par 400,000 400,000
320 Retained Earnings 180,000 ₱ 80,000 100,000
410 Sales 198,000 198,000
420 Sales Returns and Allowances 4,488 4,488
430 Sales Discount 1,060 1,060
510 Purchases 99,000 99,000
520 Purchase Returns and Allowances 4,224 4,224
530 Purchase Discount 700 700
610 Salaries Expense 52,000 52,000
620 SSS, Philhealth and Pagibig Contributions 2,600 2,600
630 Rent Expense 18,000 18,000
640 Utilities Expense 2,550 2,550
650 Supplies Expense 3,080 3,080
670 Depreciation Expense-Store Equipment 1,000 1,000
680 Depreciation Expense-Office Equipment 500 500
₱ 881,412 ₱ 881,412 ₱ 86,650 ₱ 86,650 249,278 266,660 702,520 685,138
Net Income (Net Loss) 17,382 17,382
TOTAL ₱ 266,660 ₱266,660 ₱ 702,520 ₱702,520
 TOLENTINO TRADING
Statement of Comprehensive Income Tolentino Trading
For the month ended May 31, 2021 Statement of Changes in Stockholder’s Equity
For the Month Ended May 31, 2021
Sales ₱ 198,000
Less: Sales Returns and Allowances (4,488) Ordinary Share Capital ₱100,000 par ₱400,000
Less: Sales Discount (1,060) Retaining Earnings, May 1, 2021 ₱180,000
Net Sales ₱192,452 Add/Less: Net income (Net Loss) 17,382
Less: Cash Dividends (80,000)
Purchases ₱99,000 Retained Earnings, May 31, 2021 117,382
Less: Purchases Returns and Allowances (4,224) TOTAL STOCKHOLFER’S EQUITY ₱517,382
Less: Purchase Discount (700)
Net Purchases ₱94,076
Add: Merchandise Inventory-Beginning 65,000
Less: Merchandise Inventory –End (63,736)
Less:Cost of Goods Sold (95,340)
Gross Profit ₱ 97,112

Operating Expenses
Salaries Expense ₱52,000
SSS, PhilHealth and Pag-ibig Contributions 2,600
Rent Expense 18,000
Utilities Expense 2,550
Supplies Expense 3,080
Depreciation Expense-Store Equipment 1,000
Depreciation Expense-Office Equipment 500
Total Expenses 79,730

NET INCOME (LOSS) ₱ 17,382

 Tolentino Trading
Statement of Financial Position
May 31, 2021

ASSETS
Current Assets
Cash ₱ 323,040
Accounts Receivable 107,400
Merchandise Inventory 63,736
Input VAT 28,344
Total Current Assets ₱522,520
Non-Current Assets
Store Equipment ₱120,000
Accumulated Depreciation-Store Equipment (6,000) ₱114,000
Office Equipment ₱ 60,000
Accumulated Depreciation- Office Equipment (3,000) 57,000
Total Non-current Assets 171,000
TOTAL ASSETS ₱ 693,520
LIABILITIES
Accounts Payable ₱ 62,000
Withholding Tax Payable 1,300
SSS, PH and Pagibig Payable 3,900
Utilities Payable 2,550
Output VAT 26,388
Cash Dividends Payable 80,000
Total Liabilities ₱ 176,138
STOCKHOLDER’S EQUITY
Ordinary Share Capital ₱ 100 par ₱ 400,000
Retained Earnings, May 31, 2021 117,382
Total Stockholder’s Equity 517,382
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY ₱ 693,520
 Tolentino Trading
Statement of Cash Flows
For the Month Ended May 31, 2021

CASH-IN ACTIVITIES:
Cash Sales ₱ 89,500
Collections from Accounts Receivable 51,940
Refund from returned merchandise 2,300
Total Cash-In ₱ 143,740
CASH-OUT ACTIVITIES:
Purchased Merchandise ₱ 25,000
Payment of Accounts 34,300
Purchased Store Supplies 3,500
Refund to Customer 3,000
SSS, Philhealth and Pagibig Contributions 3,900
Payment for Utilities (April usage) 5,720
Payment for BIR 1,900
Payment for Payroll (May 1 -15) 24,700
Payment for Rental 18,000
Payment for Payroll (May 16 – 31) 24,700
____________________________ _____________
____________________________ _____________
____________________________ _____________
Total Cash-Out (144,720)

Net Increase (decrease) in cash ₱ (980)

Add: Cash Balance, May 1, 2021 324,020
CASH BALANCE, May 31, 2021 ₱ 323,040
 Tolentino Trading
Post-Closing Trial Balance
May 30, 2021

Account Titles Debit Credit

110 Cash ₱323,040
120 Accounts Receivable 107,400
130 Merchandise Inventory 63,736
140 Input VAT 28,344
150 Store Equipment 120,000
155 Accumulated Depreciation-Store Equipment ₱6,000
160 Office Equipment 60,000
165 Accumulate Depreciation-Office Equipment 3,000
210 Accounts Payable 62,000
220 Withholding Tax Payable 1,300
240 SSS, PhilHealth and PagiIbig Payable 3,900
250 Utilities Payable 2,550
260 Output VAT 26,388
270 Cash Dividends Payable 80,000
310 Ordinary Shares Capital ₱ 100 par 400,000
320 Retained Earnings 117,382

₱ 702,520 ₱702,520