Name: ______________________________________________

Problem Set 1
CASE PROBLEM 2 – DOLE DISTRIBUTORS
April 1 The business, DOLE DISTRIBUTORS, was registered as a single proprietorship with the
Department of Trade and Industry, Juan Lopez invested P39,000.
2 Bought computer equipment for P10,000 cash.
2 Bought merchandise on accounts from LOWTOWN Supply Co, P15,900, terms 2/10, n/30
3 Bought office supplies on cash basis for P700.
4 Sold merchandise on accounts P15,200, FOB Destination, terms 2/10, n/30.
5 Paid P200 freight on April 4 sale.
6 Received credit from LOWTOWN supply Co for merchandise returned P300.
11 Paid LOWTOWN.
13 Collected from April 4 customers.
14 Bought merchandise on cash basis for P14,400
15 Salaries paid P1,500.
16 Borrowed money from RCBC Bank, signed a promissory note for P12,000.
17 Received refund from a supplier on cash purchase of April 14, P500.
18 Bought merchandise from MESMA, P14,200, FOB Shipping point, terms, 2/10 n/30.
20 Paid freight on April 18 purchase, P700.
23 Sold merchandise for P16,400.
26 Bought merchandise for cash, P12,300.
27 Paid MESMA on April 18 purchase, P9,000. No discount allowed on partial payment.
28 J. Lopez got cash from the business, P2,008.
29 Made cash refund to customer for defective merchandise, P900.
30 Sold merchandise on accounts, P13,700, n/30.
30 Paid the following: Advertising, P1,000; Utilities, P400; Rent P3,500; Salaries, P1,500.
30 Inventory April 30, P25,000

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 DOLE DISTRIBUTORS
CHART OF ACCOUNTS
Use for Journalization and Posting to the Ledger

100 ASSETS 400 INCOME

101 Cash 401 Sales
105 Accounts Receivable 405 Sales Returns and Allowances
115 Merchandise Inventory 410 Sales Discount
120 Supplies 500 EXPENSES
150 Equipment 501 Purchases
200 LIABILITIES 502 Purchases Returns and Allowances
201 Accounts payable 503 Purchase Discounts
202 Notes Payable 504 Freight In
300 EQUITY 505 Advertising
301 Lopez, Capital 506 Freight Out
302 Lopez, Drawings 510 Rent Expense
530 Salaries
540 Utilities
601 Income Summary

DOLE DISTRIBUTORS
CHART OF ACCOUNTS
Use for the Preparation of financial Statements

100 ASSETS 400 INCOME

101 Cash and Cash Equivalents 401
105 Receivables 405 Net Sales
115 Inventories 410
120 Prepaid Expenses 500 EXPENSES
150 Property, Plant & Equipment 501
200 LIABILITIES 502 Cost of Goods Sold
201 Accounts payable 503
202 Notes Payable 504
300 EQUITY 505 Advertising
301 Lopez, Capital 506 Freight Out
302 Lopez, Drawings 510 Rent Expense
530 Salaries
540 Utilities
601 Income Summary

2
General Journal
Page Number: GJ-1
With Explanations
CURRENT JOURNAL ENTRIES
DATE DESCRIPTION REF DEBIT CREDIT
April 1 CASH P 39,000.00
LOPEZ, CAPITAL P 39,000.00
TO RECORD INITIAL INVESTMENT

2 EQUIPMENT 10,000.00
CASH 10,000.00
TO RECORD EQUIPMENT FOR CASH

2 PURCHASES 15,900.00
ACCOUNTS PAYABLE 15,900.00
TO RECORD PURCHACE ON ACCOUNT, 2/10,
N/30

3 SUPPLIES 700.00
CASH 700.00
TO RECORD SUPPLIES FOR CASH

4 ACCOUNT RECEIVABLES 15,200.00

SALES 15,2000.00
TO RECORD SALES ON ACCOUNT, 2/10,
N/30

5 FREIGHT OUT 200.00

CASH 200.00
TO RECORD FREIGHT OUT

6 ACCOUNTS PAYABLE 300.00

PURCHASE RET. AND ALLOW. 300.00
TO RECORD PURCHASE R & A

11 ACCOUNTS PAYABLE 15,600.00

CASH 15,288.00
PURCHASE DISCOUNT 312.00
TO RECORD FULL PAYMENT OF ACCOUNT

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General Journal
Page Number: GJ-2
With Explanations
CURRENT JOURNAL ENTRIES
DATE DESCRIPTION REF DEBIT CREDIT
April 13 CASH 14,896.00
SALES DISCOUNT 304.00
ACCOUNTS RECEIVABLE 15,200.00
TO RECORD COLLECTION OF CASH FROM
ACCOUNT

14

15

16

17

18

20

23

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General Journal
Page Number: GJ-3
With Explanations
CURRENT JOURNAL ENTRIES
DATE DESCRIPTION REF DEBIT CREDIT
April 26

27

28

29

30

30

5
 GENERAL LEDGERS
Account title: Cash Account # 101
Balance
Date Item F Debit Credit Debit Credit
2016 1 FIRST ENTRY GJ-1 P39,000.00 P39,000.00
APR
2 GJ-1 P10,000.00 29,000.00
3 GJ-1 700.00 28,300.00
5 GJ-1 200.00 28,100.00
11 GJ-1 15,288.00 12,812.00
13 GJ-2 14,896.00 27,708.00
14 GJ-2 14,400.00 13,308.00
15 GJ-2 1,500.00 11,808.00
16 GJ-2 12,000.00 23,808.00
17 GJ-2 500.00 24,308.00
20 GJ-2 700.00 23,608.00
23 GJ-2 16,400.00 40,008.00
26 GJ-3 12,300.00 27,708.00
27 GJ-3 9,000.00 18,708.00
28 GJ-3 2,008.00 16,700.00
29 GJ-3 900.00 15,800.00
30 GJ-3 6,400.00 P9,400.00

Account Title: Accounts Receivable Acct # 105

Balance
Date Item Post Debit Credit Debit Credit
April 4 FIRST ENTRY GJ-1

Account 115 MERCHANDISE INVENTORY

Balance
Date Item Post Debit Credit Debit Credit
April

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 GENERAL LEDGERS
Account 120 SUPPLIES
Balance
Date Item Post Debit Credit Debit Credit
April

Account 150 EQUIPMENT

Balance
Date Item Post Debit Credit Debit Credit
April

Account 201 ACCOUNTS PAYABLE

Balance
Date Item Post Debit Credit Debit Credit
April

Account 202 NOTES PAYABLE

Balance
Date Item Post Debit Credit Debit Credit
April

Account 301 LOPEZ, CAPITAL

Balance
Date Item Post Debit Credit Debit Credit
April

Account 302 LOPEZ, DRAWING

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 Balance
Date Item Post Debit Credit Debit Credit
April

GENERAL LEDGERS
Account 401 SALES
Balance
Date Item Post Debit Credit Debit Credit
April

Account 405 SALES RETURNS AND ALLOWANCES

Balance
Date Item Post Debit Credit Debit Credit
April

Account 410 SALES DISCOUNTS

Balance
Date Item Post Debit Credit Debit Credit
April

Account 501 PURCHASES

Balance
Date Item Post Debit Credit Debit Credit
April

Account 502 PURCHASE RETURNS AND ALLOWANCE

Balance
Date Item Post Debit Credit Debit Credit
April

8
 GENERAL LEDGERS
Account 503 PURCHASE DISCOUNTS
Balance
Date Item Post Debit Credit Debit Credit
April

Account 504 FREIGHT IN

Balance
Date Item Post Debit Credit Debit Credit
April

Account 505 ADVERTISING EXPENSE

Balance
Date Item Post Debit Credit Debit Credit
April

Account 506 FREIGHT OUT

Balance
Date Item Post Debit Credit
Debit Credit
April

Account 510 RENT EXPENSE

Balance
Date Item Post Debit Credit
Debit Credit
April

Account 530 SALARIES

Balance
Date Item Post Debit Credit
Debit Credit
April

9
 GENERAL LEDGERS
Account 540 UTILITIES
Balance
Date Item Post Debit Credit
Debit Credit
April

Account 506 INCOME SUMMARY

Balance
Date Item Post Debit Credit
Debit Credit
April

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 DOLE DISTRIBUTORS
PRELIMINARY TRIAL BALANCE
APRIL 30, 2016
ACCT # ACCOUNT TITLES DEBIT CREDIT
101 Cash
105 Accounts Receivable
115 Merchandise Inventory
120 Supplies
150 Equipment
201 Accounts Payable
202 Notes Payable
301 Lopez, Capital
302 Lopez, Drawings
401 Sales
405 Sales Returns and Allowance
410 Sales Discount
501 Purchases
502 Purchases Returns and Allowance
503 Purchase Discounts
504 Freight In
505 Advertising
506 Freight Out
510 Rent
530 Salaries
540 Utilities
TOTALS

DOLE DISTRIBUTORS
COST OF GOODS SOLD
FOR THE MONTH ENDED APRIL 30, 2017
(IN PESOS)

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 DOLE DISTRIBUTORS
STATEMENT OF PERFORMANCE
FOR THE PERIOD ENDED APRIL 30, 2017
(IN PESOS)

DOLE DISTRIBUTORS
STATEMENT OF EQUITY
FOR THE PERIOD ENDED APRIL 30, 2017
(IN PESOS)

12
 DOLE DISTRIBUTORS
STATEMENT OF FINANCIAL POSITION
APRIL 30, 2017
(IN PESOS)

13
 DOLE DISTRIBUTORS
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED APRIL 30, 2017
(IN PESOS)

14
GENERAL JOURNAL
PAGE NUMBER: GJ-4
With Explanations
CLOSING JOURNAL ENTRIES
DATE DESCRIPTION REF DEBIT CREDIT
April 30

15
 DOLE DISTRIBUTORS
POST – CLOSING TRIAL BALANCE
APRIL 30, 2017
(IN PESOS)
ACCOUNT TITLES DEBIT CREDIT

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SET 2
CASE PROBLEM 2

2.1. BDO, a bank lent P10,000 to a customer on December 1 that required the customer to pay an
annual percentage rate (April) of 12% on the amount of the loan. The loan is due in six months
and no payment of interest or principal is to be made until the note is due on May 31. BDO
prepares monthly financial statements at the end of each calendar month.

2.2. In December 1, AXA Insurance Co. received P2,400 from your company for the annual insurance
premium covering the twelve-month period beginning on December 1. AXA Insurance Co.
recorded the P2,400 receipt as of December 1 with a debit to the current asset Cash and a credit
to the current liability Unearned Revenues. AXA Insurance Co. prepares monthly financial
statements at the end of each calendar month. Provide an answer for April only.

2.3. On December 1, FORTUNE company began operations. On December 4, it Purchased P1,500

supplies and recorded the transaction with a debit to the balance sheet account Supplies and a
credit to the current liability Accounts Payable. FORTUNE company prepares monthly financial
statements at the end of each calendar month. At the end of the day on December 31, FORTUNE
company estimated that P700 of the supplies were still on hand in the supply room. The following
questions pertain to the adjusting entry that should be entered by FORTUNE company.

Requirement: Answer the questions pertaining to the adjusting entries for each of the cases. Use the
answer sheet provided for case 2 set 2.

What is the? Case 2.1 Case 2.2 Case 2.3

Date to be used for the

adjusting entry

Debit account title

Credit account title

Debit & Credit Amount

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