Accounting Chapter 3
Accounting Chapter 3
Accounting Chapter 3
Cash Basis
01 Cash Received in January for February Flights PHP 5,500,000
02 Cash Received in Februaury for February Flights PHP 3,000,000 PHP 3,000,000
03 Cash Received in February for March Flights PHP 4,000,000 PHP 4,000,000
04 Cash Received in March for February Flights PHP 4,500,000
Total Revenue PHP 17,000,000 PHP 7,000,000
PHP 4,500,000
PHP 13,000,000
Transactions of Bentong Consultancy
01 Salary payments in May for work performed by employees in April PHP 28,000
02 Salary payments in June for work performed by employees in May PHP 20,000
03 Salary payments in June for work performed by employees in June PHP 25,000
04 Salary payments in July for work performed by employees in June PHP 10,000
Total Salary Expense PHP 83,000
Using the accrual rule, determine the salary expense to be reported for PHP 35,000
#1 June
Using the cash concept, determine the salary expense to be reported for PHP 45,000
#2 June
Cash Basis Accrual Basis
PHP 20,000
PHP 25,000 PHP 25,000
PHP 10,000
PHP 45,000 PHP 35,000
Cash Basis Income Statement
Revenues
Cash from Music Lessons PHP 5,000
Expenses
Wages Paid PHP 800
Revenues
Sales from Music Lessons PHP 12,000
Expenses
Wages Expense PHP 800
Utilities Expense PHP 700
PHP 75,000
PHP 500,000 PHP 500,000
PHP 80,000
PHP 250,000 PHP (250,000)
PHP 180,000
PHP 175,000
Less: Expenses
Rent Expense PHP 15,000
Salaries Expense PHP 850
Repair Service Expense PHP 250
Utilities Expense PHP 400
Supplies Expense PHP 3,980
Total Expenses PHP 20,480
Assets
Current Assets
Cash PHP 75,700
Accounts Receivable PHP 5,025
Supplies PHP 12,320
Equipment PHP 75,000
Total PHP 168,045
Total Assets PHP 168,045
Current Liabilities
Accounts Payable PHP 22,450
Total Liabilities PHP 22,450
Owner's Equity
Galing, capital PHP 145,595
Total Liabilities and Owner's Equity PHP 168,045