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Concept explainers
Mr. Lopez opened a mini grocery store with the business name Lopez Fiesta Mart. Operations began on January 1, 2021, and the following transactions were completed during the month:
01 |
Mr. Lopez withdrew PHP 150,000.00 from a personal savings account and used it to open a new account in the name of Lopez Fiesta Mart. |
02 |
Bought grocery supplies on account PHP 10,700.00. |
04 |
Acquired a service vehicle costing PHP 76,000.00. A payment of PHP 25,000.00 Cash was made and a note payable was given for the PHP 51,000.00 remainder payable for 6 equal monthly installments. |
06 |
Purchased merchandise from Puregold PHP 49,500.00, terms 5/10, 3/20. |
07 |
Paid PHP 1,600.00 delivery charge for January 04 transactions. |
08 |
Paid for three months of advertising and recorded Prepaid Advertising in the amount of PHP 6,000.00 |
11 |
Sold merchandise on account PHP 42,000.00 with 40% mark-up from the inventory cost of PHP 30,000.00, term 2/10, n/30. |
12 |
Paid PHP 1,200.00 freight for January 11 transactions. |
14 |
Returned defective merchandise to Puregold amounting to PHP 4,500.00. |
15 |
Paid salaries, PHP 5,600.00. |
16 |
Signed a promissory note for PHP 30,000.00 loaned amount from Commonwealth Bank. |
17 |
Received returned merchandise from customer PHP 3,500.00. |
18 |
Paid PHP 5,700.00 of the amount owed from the transaction of January 02. |
19 |
Purchase additional groceries from Talavera Supermarket amounting to PHP 44,000.00. |
20 |
Collected full settlement of a customer from January 11 transactions. |
24 |
Paid telephone expense, PHP 1,600.00. |
25 |
Paid building rentals for the month, PHP 4,800.00 |
26 |
Settled accounts to Puregold. |
27 |
PHP 41,750.00 cost of merchandise sold for PHP 58,450.00. |
28 |
Withdrew PHP 20,000.00 from the business. |
29 |
Paid miscellaneous expenses, PHP 3,430.00. |
30 |
Paid the first installment of the note payable on Service Vehicle, PHP 8,500.00. |
31 |
Paid Salaries PHP 5,100.00, net of the following deductions: SSS, PHP 380.00; Pag-IBIG, PHP 100.00; Philhealth, PHP 220.00. |
The remaining inventory at the end of the month is PHP 20,000.00.
Chart of Accounts
Account Number |
Account Titles |
110 |
Cash |
120 |
|
130 |
Supplies |
140 |
Prepaid Advertising |
150 |
Merchandise Inventory |
160 |
Service Vehicle |
210 |
Accounts Payable |
220 |
SSS Payable |
230 |
Pag-IBIG Payable |
240 |
Philhealth Payable |
250 |
Notes Payable |
310 |
Lopez, Capital |
320 |
Lopez, Drawings |
410 |
Sales |
420 |
Sales Returns and Allowances |
430 |
Sales Discount |
550 |
Cost of Goods Sold |
610 |
Freight Out |
620 |
Salaries Expense |
630 |
Rent Expense |
640 |
Telephone Expense |
650 |
Miscellaneous Expense |
700 |
Income Summary |
Required:
1.Prepare Statement of Financial Performance
2.Prepare Statement of Cashflow
3. Closing Entries
(Use Periodic Inventory System)
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