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Accounting 10Ateneo Lex1 Chapter 3 Short Problems.

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Presentation on theme: "Accounting 10Ateneo Lex1 Chapter 3 Short Problems."— Presentation transcript:

1 Accounting 10Ateneo Lex1 Chapter 3 Short Problems

2 Accounting 10Ateneo Lex2 Short Problem 1 Solution: Insurance Premium Debit|Credit 3200|1600 1200 |1500 P12100--> answer

3 Accounting 10Ateneo Lex3 Short Problem 2 Solution: Net Income100,000 Depreciation(2,000) Accounts Rec.20,000 Supplies15,000 Net Income, Dec. 31P133,000 - Answer

4 Accounting 10Ateneo Lex4 Short Problem 3 Deaq Gordon assists Filipino students upon their arrival in the United States. Paid by the Philippine government, Deaq Gordon collects some service revenue in advance. In other cases, he receives cash from said government after performing relocation services. At the end of August 2004, Deaq Gordon’s books report the following: July 31August 31 Accounts Receivable95,000110,000 Unearned Service Rev.60,00015,000 If during August, Deaq Gordon Enterprises reported service revenue of P285,000 how much cash did the business collect from the Philippine government during that month? Accounts Receivable 95000 Revenues Cash Collection 110,000 Solution: Unearned Rev 60,000 Revenues Cash Collection 15000 95000 60000 285000 Ans=225000 95000

5 Accounting 10Ateneo Lex5 Short Problem 4 Solution: Revenues390,000 Expenses36,000 215,000 78,000 (329000) Net Income P61,000

6 Accounting 10Ateneo Lex6 Short Problem 5 Solution:Revenues: 252,000 Cash Revenue240000Less: expenses(142,500) Accounts Receivable12000Net Income 109500 - ans Total Revenues252000 Cash Expense155000 Less: Accrued Expense(12500) Total Expense142500

7 Accounting 10Ateneo Lex7 Short Problem 6 Accounts Receivable 15,00095,000 X=96500 16500 Accounts Receivable 96500 Revenue96500 Cash Sales15,000 A/R Sales96,500 111,500 Answer. Solution:

8 Accounting 10Ateneo Lex8 Short Problem 7 Solution: Cash Expense75,000 Adj. Prepaid900 Adj. Acc. Expense3660 79560 -- Answer

9 Accounting 10Ateneo Lex9 Short Problem 8 Solution: ORIX = 1,950,000/24 months x 11 months = 893,750 = 1056,250 PX = 2760,000/24 months x 6 months = 690,000 = 2070,000 AUTO LIFE = 1845000/36 months x 4 months = 205,000= 1,640,000 P4,766,250 - Answer

10 Accounting 10Ateneo Lex10 Short Problem 9 Unearned Revenues 1,500,000 15,000,0007,200,000 3,600,000 3600,000 - Answer Solution:

11 Accounting 10Ateneo Lex11 Short Problem 10 Solution: 1500 32001600 2000 3600 - Answer

12 Accounting 10Ateneo Lex12 Short Problem 11 Unearned Rent Accrued Rent Revenue3000 cash 4200 1800 Rev. Cash 2400 1500 3000 29400 (ANS) 30000 1800 Solution:

13 Accounting 10Ateneo Lex13 Short Problem 12 Solution: Net Income80,000 Office Supplies(1,500) ServiceExpense2,500 Accrued Interest(4,500) 76,500 --> Answer

14 Accounting 10Ateneo Lex14 Short Problem13 Solution: 9000x 3 = 450 --> Answer 5 x 12

15 Accounting 10Ateneo Lex15 Short Problem 14 Solution: Depreciation:Fees earned15,000 9000x 6 = 900Unearned Fees(10,000) 5 x12Depreciation(900) Salaries(6000) Adv.(150) Utilities(600) Answer:Net Loss(2650)

16 Accounting 10Ateneo Lex16 Short Problem 15 Solution: Interest Exp. 20x2 = 80,000 x.10 = (3/12) = 2000 (ANS)

17 Accounting 10Ateneo Lex17 Short Problem 16 Solution: 80000 x.10 x (6/12) = 4,000 (ANS)

18 Accounting 10Ateneo Lex18 Short Problem 17 and 18 17. On March 1, 2000,the corporation signed a five-year lease agreement covering the rental of a copying machine. The P6,000 rental is payable annually,with the first payment due on March 1, 2001. The rental expense chargeable to operations in 2001, on a cash basis of accounting will be: Answer: P6,000 18. If the supplies account,before adjustment on May 31,indicated a balance of P2,250, and an inventory of supplies on hand at May 31 totaled P950, the adjusting entry would be: Solution: 2250 - 950 = 1300Supplies Expense 1300 Supplies1300

19 Accounting 10Ateneo Lex19 Short Problem 19 and 20 19. If the estimated amount of depreciation on equipment for the period is P2,000,the adjusting entry to record depreciation would be: Answer:Depreciation Expense2000 Depreciation2000 20. On January 2, 20X6, the company paid P6,000 for a three-year fire insurance policy. The company used the asset method upon recording the premium paid on January 2, 20X6. Under the going concern concept of accounting, the amount of prepaid insurance that should be shown on the company’s balance sheet as of Dec. 31, 20X7 is: Solution: Prepaid Insurance60001/20x66000 Cash600012/20x64000 Insurance Expense200012/20x72000 (ANS) Prepaid Insurance2000

20 Accounting 10Ateneo Lex20 Short Problem 21 and 22 21. Howard Company sublet a portion of its warehouse for five years at an annual rental of P18,000 beginning on May 1, 1999. The tenant paid one year’s rent in advance, which Howard recorded as a credit to unearned rental income. Howard reports on a calendar-year basis. The adjustment on December 31, 1999 should be: Solution:18000/12 x 8 = 12,000 (Answer) 22.The corporation’s books showed a rent account with a balance of P1,800 for a one-year lease paid on January 31, 2000. What would be the correct amount of prepaid rent for the balance sheet as of December 31, 2000? Solution: 1800/12 x 11 = 16501800-1650 = P150 (ANSWER)

21 Accounting 10Ateneo Lex21 Short Problem 23 and 24 Answer: P172,000 130,000 42,000 172,000 (ANS)

22 Accounting 10Ateneo Lex22 Short Problem 25 and 26 P249350 - ANS P130000 - ANS

23 Accounting 10Ateneo Lex23 Short Problem 27 and 28 27. The following information was gathered from a business using an incomplete method of accounting. Accounts receivables on January 1, 2000 totaled P34,000, collections from customers during the year were P142,000, and the accounts receivables on December 31, 2000, P36,000. How much were credited sales for 2000? Accounts Receivable 34000 ANS=144000 142000 36000 Solution: 28. If the equipment account has a balance of P22,500 and its accumulated depreciation account has a balance of P14,000, the book value of the equipment is: ANS: 8500

24 Accounting 10Ateneo Lex24 Short Problem 29 29. William Company reported Prepaid Expenses of P150,000. Examination of the accounting records revealed that this account consists of the following items: A.Prepaid insurance (bought on March 1, 2004 covering one-year fire insurance for P12,000) B.Rent paid in advance in the amount of P120,000 covering six-months rental from October1, 2004 - March 31,2005. C.Supplies acquired January 1, 2004 amounting to P18,000. A physical inventory on December 31, 2004 disclosed that only P6,500 worth supplies are still on hand) The company is preparing its financial statements for the year ending December 31, 2004. What will be the adjusting entry to be made on the books to update accounts? Ans: a.Prepaid Insurance 12000 Cash 12000 b. Prepaid Rent120,000 Cash120,000 c. Supplies18000 Cash 18000

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