CASE PROBLEM – PERPETUAL

Lopez Merchandising completed the following transactions:

April 1 John Lopez invested P 39,000.

2 Purchased equipment, P 10,000.

2 Bought merchandise from LT Supply P 15,900. Terms: 2/10, n/30.

3 Bought office supplies on cash basis, P 700.

4 Sold merchandise on credit P 15,200. FOB Destination. Terms: 2/10, n/30.

The cost of merchandise sold was P 12,200.

5 Paid freight on April 4 sales, P 200.

6 Received credit memo from LT Supply for merchandise returned P300.

11 Paid LT Supply.

13 Collected from April 4 sales.

14 Bought merchandise on cash, P 14,400.

15 Paid salaries, P 1,500.

16 Borrowed money from a bank P 12,000 signed a promissory note.

17 Received refund from supplier on cash purchase, P 500.

18 Bought merchandise from EDSA P 14,200. FOB shipping point, terms:

2/10, n/30.

20 Paid freight on April 18 purchase, P 700.

20 Sold merchandise P 16,400. The merchandise sold has a cost of P 10,500.

25 Purchase merchandise for cash, P 12,300.

27 Paid EDSA P 9,000. No discount allowed on partial payment.

28 John Lopez took cash from business, P 2,008.

29 Made refund to cash customers for defective merchandise, P 900.

30 Sold merchandise on account, P 13,700, n/30. Cost of the merchandise sold is P 11,000.

30 Paid the following: Advertising P 1,000, Utilities, P 400; Rent P 3,500; Salaries P 1,500.
 LOPEZ MECHANDISING
CHART OF ACCOUNTS
For Journalizing and Posting

100 ASSETS 400 INCOME

101 CASH 401 SALES
105 ACCOUNTS RECEIVABLE 405 SALES RETURNS AND ALLOWANCES
115 MERCHANDISE INVENTORY 410 SALES DISCOUNTS
120 SUPPLIES 500 EXPENSES
150 EQUIPMENT 501 COST OF GOODS SOLD
200 LIABILITIES 503 ADVERTISING EXPENSE
201 ACCOUNTS PAYABLE 506 FREIGHT OUT
202 NOTES PAYABLE 510 RENT EXPENSE
300 EQUITY 530 SALARIES
301 LOPEZ, CAPITAL 540 UTILITIES
302 LOPEZ, DRAWING 601 INCOME SUMMARY

LOPEZ MECHANDISING
CHART OF ACCOUNTS
For Financial Statements

100 ASSETS 400 INCOME

101 CASH & CASH EQUIVALENTS 401 Net Sales
105 RECEIVABLES 405
115 INVENTORIES 410
120 PREPAID EXPENSES 500
150 PROPERTY, PLANT AND EQUIPMENT 501 COST OF GOODS SOLD
200 LIABILITIES 503 ADVERTISING EXPENSE
201 ACCOUNTS PAYABLE 506 FREIGHT OUT
202 NOTES PAYABLE 510 RENT EXPENSE
300 EQUITY 530 SALARIES
301 LOPEZ, CAPITAL 540 UTILITIES
302 LOPEZ, DRAWING
 Page Number 1 Journal Entries

Date Ref Debit Credit

April 1 Cash

Lopez, Capital

• To record investment of Mr. Lopez

2 Equipment

Cash

• To record purchase equipment

2 Merchandise inventory

Accounts payable

• To record purchase of merchandise Inventory

on account

3 Supplies

Cash

• To record purchase of supplies on cash basis

4 Accounts receivable

Sales

Cost of good sold

Merchandise inventory

•To record merchandise inventory on account

 Page Number 2 Journal Entries
Date

April 5 Freight out

Cash

• To record the freight out paid

6 Accounts payable

Merchandise inventory

• To record the merchandise inventory returned

by the company

11 Accounts payable

Merchandise inventory

Cash

• To record paid merchandise inventory that is

still under the discount period

13 Cash

Sales discount

Accounts receivable

• To record the cash received from april 4 sales

14 Merchandise inventory

Cash

• To record the purchased of merchandise

inventory on cash basis

15 Salaries

Cash
 • To record the payment of salaries •

16 Cash

Notes payable

• To record the cash borrowed from the bank

Page Number 3 Journal Entries

Date

April 17 Cash

Merchandise inventory

• To record the cash refund from the

merchandise inventory on cash basis

18 Merchandise inventory

Accounts payable

• To record merchandise inventory purchased

on account

20 Merchandise inventory

Cash

• To record the freight paid by the company

20 Cash

Sales

Cost of good solds

Merchandise inventory

• To record the merchandise inventory sold

25 Merchandise inventory
 Cash

• To record the merchandise inventory

purchased in cash basis

27 Accounts payable

Cash

• To record the partial payment to EDSA

28 Lopez, Drawings

Cash

• To record the withdrawal of the owner

29 Sales and return allowances

Cash

• To record the refund to the customer for

defective mechandise inventory

30 Accounts receivable

Sales

Cost of good solds

Merchandise inventory

• To record the sale of merchandise inventory

on account

30 Advertising expense

Utilities expense

Rent expense

Salaries expense

Cash

•To record the payment of operating expenses

Page number
 Account 101 CASH
DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CRE Page number
Account 105 ACCOUNTS RECEIVABLE
DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CREDIT

Page number
Account 120 SUPPLIES
DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CREDIT

Page number
Account 115 MERCHANDISE INVENTOR
DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CRE
Page number
Account 150 EQUIPMENT
DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CREDIT

Page number
Page number
Account 201 ACCOUNTS PAYABLE
Account 202 NOTES PAYABLE
DATE ITEM REF DEBIT CREDIT BALANCE
DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CRE
DEBIT CREDIT

Page number Page number

Account 301 LOPEZ, CAPITAL Account 302 LOPEZ, DRAWING
DATE ITEM REF DEBIT CREDIT BALAN DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CRE
DEBIT CREDIT

Page number
Page number Account 501 COST OF GOODS SOLD
Account 401 SALES DATE ITEM REF DEBIT CREDIT BALANCE
DATE ITEM REF DEBIT CREDIT BALANCE DEBIT CREDIT
DEBIT CRE
Page number Page number
Account 405 SALES RETURNS AND Account 410 SALES DISCOUNTS
ALLOWANCES DATE ITEM REF DEBIT CREDIT BALANCE
DATE ITEM REF DEBIT CREDIT BALANCE DEBIT CREDIT
DEBIT CRED

Page number Page number

Account 503 ADVERTISING EXPENSE Account 506 FREIGHT-OUT
DATE ITEM REF DEBIT CREDIT BALANCE DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CRE DEBIT CREDIT

Page number Page number

Account 510 RENT EXPENSE Account 530 SALARIES
DATE ITEM REF DEBIT CREDIT BALANCE DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CRE DEBIT CREDIT

Page number Page number

Account 540 UTILITIES Account 600 INCOME SUMMARY
DATE ITEM REF DEBIT CREDIT BALANCE DATE ITEM REF DEBIT CREDIT BALANCE
DEBIT CRE DEBIT CREDIT

LOPEZ MERCHANDISING
TRIAL BALANCE
APRIL 30, 2016
ACCOUNT TITLES DR CR
 LOPEZ MERCHANDISING
STATEMENT OF PERFORMANCE
FOR THE PERIOD ENDED APRIL 30, 2016

LOPEZ MERCHANDISING
STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED APRIL 30, 2016

LOPEZ MERCHANDISING
STATEMENT OF FINANCIAL POSITION
AS OF APRIL 30, 2016
 LOPEZ MERCHANDISING
STATEMENT OF CASH FLOWS
FOR THE PERIOD APRIL 30, 2016

LOPEZ MERCHANDISING
POST-CLOSING TRIAL BALANCE
APRIL 30, 2016
ACCOUNT TITLES DR CR
Page Number CLOSING JOURNAL ENTRIES

DATE DESCRIPTION REF DEBIT CREDIT