Analyzing

Journalizing
Posting
Preliminary Trial Balance
Worsheet and adjusting transactions
FS
Journalizing and psoting adjusting journal entries
Journalizing and posting of closing journal entries
Post closing trial balance
Journalizing and posting of reversing entries
 Niko Ong Art Gallery
Chart of Accounts

Assets Revenue
100 Cash 400
101 Accounts Receivable
102 Art Supplies Expenses
103 Prepaid Rent 500
104 Prepaid Insurance 501
105 Transportation Equipment 502
106 Office Equipment 503
107 Accumulated Depreciation - Transportation equipment 504
108 Allowance for bad debts 505
506

Liabilities
200 Accounts Payable
201 Notes Payable
202 Utilities Payable
203 Unearned Painting Revenue
204 Interest Payable
205 Salaries Payable

Owner's Equity
300 Ong, Capital
301 Ong, Drawing
302 Income Summary
 lery
nts

Revenue
Painting Revenue

Expenses
Salaries expense
Utilities Expense
Art Supplies expense
Rent expense
Insurance Expense
Depreciation expense - Transportation equipment
Bad debts expense
September 2014
Sept . 1

Niko Ong has a talent for painting. He is into charcoal, water color, acrylic, and oil painting.
Having the flair for it, he started studying under a private tutor at the age of 10. Because of
the many requests for job paintings, Niko is getting from prospective customers; he decided to
put up an art gallery. He invested 500,000 in this initial endeavor.
1 Acquired transportation equipment to be used for delivery 300,000 cash.
1 Rented office space and paid two months’ rent in advance, 30,000.00
2 Niko Ong issued a promissory note for a 200,000 loan from Methro Bank. The note carries a
12% interest per annum. The interest and the principal are payable after one year.
4 Paid Insular Life Insurance Co., 18,000 for one year insurance of the art gallery.
5 Acquired office equipment from Abenson’s 50,000 paying 20,000 and the balance at the
end of the month.
8 The 12,000 oil paints ordered from Enriquez Art Supplies were delivered on account.
10 Paid Enriquez Art Supplies P5,000 of the amount owed.
11
Painted the portrait of Don Enriquez Zobel receiving P200,000 cash for the completed portrait.
15 Paid secretary’s salary for half month, P2,500.
17 Received 250,000 cash for a contract to paint the portrait of Dona Susana.
21 Delivered and billed Mr. Sy 150,000 for a landscape painting.
23 Niko Ong withdrew 30,000 for personal use.
23 Received bill from PLDT 900
25 Received 100,000 from Mr. Sy as partial payment for landscape painting delivered last Sept. 21.

30 Paid electricity bill for the month, 4,000

 Page: 1
General Journal
Date Account Title & Explanation PR Debit Credit

2014
Sept 1 Cash 100 500,000
Ong, Capital 300 500,000
To record initial investmenr

1 Transportation equipment 105 300,000

Cash 100 300,000
Purchased transporation equipment
on cash

1 Prepaid rent 103 30,000

Cash 100 30,000
Paid two months rent in advance

2 Cash 100 200,000

Notes payable 201 200,000
Borrowed money from the bank
issuing a promissory note

4 Prepaid insurance 104 18,000

Cash 100 18,000
Paid one year insurance premium

5 Office equipment 107 50,000

Cash 100 20,000
Accounts payable 200 30,000
Bought office equipment for cash &
the balance on account

8 Art supplies 102 12,000

Accounts payable 200 12,000
Purchased art supplies on account

10 Accounts payable 200 5,000

Cash 100 5,000
Made partial payment of liability

11 Cash 100 200,000

Painting revenue 400 200,000
Received cash for painting portrait
15 Salary expense 500 2,500
Cash 100 2,500
Paid secreatry's half month salary

17 Cash 100 250,000

Uneraned painting revenue 205 250,000
Received cash for painting service to be rendered

21 Accounts receivable 101 150,000

Painting revenue 400 150,000
Landscape painting on account

23 Ong, Drawing 301 30,000

Cash 100 30,000
Niko Ong withdrew cash for personal use

23 Utilities expense 504 900

Utilities payable 203 900
received bill from PLDT

25 Cash 100 100,000

Accounts receivable 101 100,000
Receisved cash as partial collection from Mr. Sy

30 Utilities expense 504 4,000

Cash 100 4,000
Paid electric bill for the month

Total 1,852,400 1,852,400

 General Ledger
Cash Acct. no.: 100 A
Balances
Date Explanation J.R Debit Credit Date
Debit Credit
1-Sep Investment J-1 500,000 500,000 5-Sep
1 Purchased J-1 300,000 200,000 8
1 Payment J-1 30,000 170,000 10
2 Borrow J-1 200,000 370,000
4 Payment J-1 18,000 352,000
5 Purchaed J-1 20,000 332,000
Date
10 Payment J-1 5,000 327,000
11 Received J-1 200,000 527,000 2-Sep
15 Payment J-1 2,500 524,500
17 Received J-1 250,000 774,500 U
23 Withdrawl J-1 30,000 744,500
Date
25 Received J-1 100,000 844,500
30 Payment J-1 4,000 840,500 23-Sep

Accounts Recivable Acct. no.: 101 Unearn

Balances
Date Explanation J.R Debit Credit Date
Debit Credit
21-Sep Rendered J-1 150,000 150,000 17-Sep
25 Payment J-1 100,000 50,000

Art Supplies Acct. no.: 102

Date
Balances
Date Explanation J.R Debit Credit
Debit Credit 1-Sep
8-Sep Purchased J-1 12,000 12,000 30-Sep
30-Sep Supplies used J-2 3,000 9,000 30-Sep

Prepaid Rent Acct. no.: 103

Balances
Date Explanation J.R Debit Credit Date
Debit Credit
1-Sep Payment J-1 30,000 30,000 23-Sep
30-Sep expired rent J-2 20,000 10,000 30-Sep

Prepaid Insurance Acct. no.: 104 In

Balances
Date Explanation J.R Debit Credit Date
Debit Credit
4-Sep Payment J-1 18,000 18,000 30-Sep
30-Sep expired insuran J-2 4,500 13,500 30-Sep
30-Sep

Transportation Equipment Acct. no.: 105

Balances
Date Explanation J.R Debit Credit
Date Explanation J.R Debit Credit
Debit Credit P
1-Sep Purchased J-1 300,000 300,000
Date

Office Equipment Acct. no.: 106 11-Sep

Balances 21-Sep
Date Explanation J.R Debit Credit
Debit Credit 30-Sep
5-Sep Purchased J-1 50,000 50,000
S
Accumulated Depreciation - Transportation equipment Acct. no.: 107
Date
Balances
Date Explanation J.R Debit Credit
Debit Credit 15-Sep
30-Sep Depreciation J-2 10,000 10,000 30-Sep

U
Allowance for bad debts Acct. no.: 108
Date
Balances
Date Explanation J.R Debit Credit
Debit Credit 23-Sep
30-Sep uncollectable ac J-2 2,500 2,500 30-Sep
30-Sep

Depreciation exp
Date

30-Sep
30-Sep

Ba
Date

30-Sep
30-Sep

Art
Date

30-Sep
30-Sep

Date

30-Sep
30-Sep

In
Date

30-Sep
30-Sep
 Accounts Payable Acct. no.: 200
Balances
Explanation J.R Debit Credit
Debit Credit
Purchased J-1 30,000 30,000
Purchased J-1 12,000 42,000
Payment J-1 5,000 37,000

Notes Payable Acct. no.: 201

Balances
Explanation J.R Debit Credit
Debit Credit
Borrow money J-1 200,000 200,000

Utilities Payable Acct. no.: 202

Balances
Explanation J.R Debit Credit
Debit Credit
Received bill J-1 900 900

Unearned Painting Revenue Acct. no.: 203

Balances
Explanation J.R Debit Credit
Debit Credit
Render service J-1 250,000 250,000

Ong, Capital Acct. no.: 300

Balances
Explanation J.R Debit Credit
Debit Credit
Investment J-1 500,000 500,000
Close income summ J-3 302,600 802,600
close drawing J-3 30,000 772,600

Ong, Drawing Acct. no.: 301

Balances
Explanation J.R Debit Credit
Debit Credit
Investment J-1 30,000 30,000
close drawing J-3 30,000 0

Income Summary Acct. no.: 302

Balances
Explanation J.R Debit Credit
Debit Credit
close revenue acct J-3 175,800 175,800
close expenses acct J-3 96,500 79,300
close income summ J-3 79,300 0
 Painting Revenue Acct. no.: 400
Balances
Explanation J.R Debit Credit
Debit Credit
Rendered service J-1 200,000 200,000
Rendered service J-1 150,000 350,000
close revenue acct J-3 350,000 0

Salaries expense Acct. no.: 500

Balances
Explanation J.R Debit Credit
Debit Credit
Payment J-1 2,500 2,500
close expense acct J-3 2,500 0

Utilities expense Acct. no.: 501

Balances
Explanation J.R Debit Credit
Debit Credit
Received bill J-1 900 900
Payment J-2 4,000 4,900
close expense acct J-3 4,900 0

Depreciation expense - Transporation equipment Acct. no.: 505

Balances
Explanation J.R Debit Credit
Debit Credit
Depreciation J-2 10,000 10,000
close expense acct J-3 10,000 0

Bad debts expense Acct. no.: 506

Balances
Explanation J.R Debit Credit
Debit Credit
uncollectible accou J-2 P 2,500 P 2,500
close expense acct J-3 2,500 0

Art supplies expense Acct. no.: 502

Balances
Explanation J.R Debit Credit
Debit Credit
Supplies used J-2 3,000 3,000
close expense acct J-3 3,000 0

Rent expense Acct. no.: 503

Balances
Explanation J.R Debit Credit
Debit Credit
expired rent J-2 20,000 20,000
close expense acct J-3 20,000 0

Insurance expense Acct. no.: 504

 Balances
Explanation J.R Debit Credit
Debit Credit
expired insurance J-2 4,500 4,500
close expense acct J-3 4,500 0
 Niko Ong Art Gallery
Trial Balance
September 30, 2014

Cash PHP 840,500

Accounts receivable 50,000
Art supplies 12,000
Prepaid rent 30,000
Prepaid Insurance 18,000
Transportation equipment 300,000
Office equipment 50,000
Accounts payable PHP 37,000
Notes payable 200,000
Utilities payable 900
Unearned painting revenue 250,000
Ong, Capital 500,000
Ong, Drawing 30,000
Painting revenue 350,000
Salaries expense 2,500
Utilities expense 4,900
1,337,900 1,337,900
 Niko Ong Art Gallery
Worksheet
For Year Ended September 30, 2014
Trial Balance Adjustments Adjusted trial balance
Account title
Debit Credit Debit Credit Debit
Cash 840,500 840,500
Accounts receivable 50,000 50,000
Art supplies 12,000 3,000 9,000
Prepaid rent 30,000 20,000 10,000
Prepaid Insurance 18,000 4,500 13,500
Transportation equipment 300,000 300,000
Office equipment 50,000 50,000
Accounts payable 37,000
Notes payable 200,000
Utilities payable 900
Unearned painting revenue 250,000
Ong, Capital 500,000
Ong, Drawing 30,000 30,000
Painting revenue 350,000
Salaries expense 2,500 2,500
Utilities expense 4,900 4,900
Total 1,337,900 1,337,900
Bad debts expense 2,500 2,500
Allowance for bad debts 2,500
Depreciation expense - transportation equipment 10,000 10,000
Accumulated transportation - tranportation equipment 10,000
Art Supplies expense 3,000 3,000
Rent expense 20,000 20,000
Insurance expense 4,500 4,500
40,000 40,000 1,350,400
Net income
 Adjusting Journal Entries
lery
General Jou
ber 30, 2014
Adjusted trial balance Income statement Balance sheet Date Accounts title & Explanation
Credit Debit Credit Debit Credit 2014
840,500 Dec. 31 Bad debts expense
50,000 Allowance for bad debts
9,000 To record estimated doubful accounts
10,000
13,500 31 Depreciation expense - transpo equipm
300,000 Accumulated depreciation-tran
50,000 To record depreciation expense for
37,000 37,000 the transportation equipment
200,000 200,000
900 900 31 Art supplies expense
250,000 250,000 Art supplies
500,000 500,000 To record art supplies used
30,000
350,000 350,000 31 Rent expense
2,500 Prepaid rent
4,900 To record expired rent

2,500 31 Insurance expense

2,500 2,500 Prepaid insurance
10,000 To record expired insurance
10,000 10,000
3,000
20,000
4,500
1,350,400 47,400 350,000 1,303,000 1,000,400
302,600 302,600
350,000 350,000 1,303,000 1,303,000
 Page no. 2
General Journal

unts title & Explanation PR Debit Credit

506 P 2,500
ance for bad debts 108 P 2,500
timated doubful accounts

expense - transpo equipment 505 10,000

mulated depreciation-transpo eq 107 10,000
preciation expense for
ortation equipment

502 3,000
102 3,000
supplies used

503 20,000
103 20,000

504 4,500
id insurance 104 4,500
After the adjusting journal entries, update
pired insurance the posting or general ledger for the
adjusments accounts.
 Niko Ong Art Gallery
Statement of Financial Position
As of September 30, 2014

Assets Liabilities
Current Assets
Cash P 840,500 Accounts Payable
Accounts Receivable P 50,000 Notes Payable
Less: Alowance for bad debts 2,500 47,500 Utilities Payable
Art supplies 9,000 Unearned Painting revenue
Prepaid rent 10,000 Total Liabilities
Prepaid Insurance 13,500
Total Current Assets P 920, 500
Owner's equity
Non Current Assets
Transportation equipment 300,000 Ong, Capital
Less: Accumulated depreciation 10,000 290,000 Less: Ong, Drawing
Office Equipment 50,000 Total
Total non current Asset 340,000 Add: Net income

Total Assets P 1,260,500 Total Liabilitie and Owner's Equity

 Liabilities

P 37,000
200,000
900
250,000
P 487,900

Owner's equity

P 500,000
30,000
470,000
302600 772,600

Owner's Equity P 1,260,500

 Niko Ong Art Gallery
Income Statement
For the Month Ended September 30, 2014

Painting Revenue P 350,000

Expenses
Rent P 20,000
Depreciation 10,000
Utilities 4,900
Insurance 4,500
Art Supplies 3,000
Bad debts 2,500
Salaries 2,500 47,400
Net Income P 302,600
 Niko Ong Art Gallery
Statement of Changes in Owner's Equity
For Month Ended September 30, 2014

Ong, Capital P 500,000

Add: Net Income 302,600
Sub-total P 802,600
Less: Ong, Drawing 30,000
Total Owner's Equity P 772,600
 Niko Ong Art Gallery
Statement of Cash Flows
For the Month Ended September 30, 2014 For the cash flows, pleas
po
Cash flows from Operating Activities Where the cash came fro
Receipts
Collection from customer PHP 200,000
Collection from customer 250,000
Collection from customer 100,000
Payments
Rental expense (30,000)
Insurance expense (18,000)
Art supplies (5,000)
Salary expense (2,500)
Utilities expense (4,000)
Net cash from Operating Activities PHP 490,500.00

Cash flows from Investing Activities

Payments
Purchase of transportation equip (300,000.00)
Purchase of office equipment (20,000.00)
Net cash from Investing Activities (320,000)

Cash flows from financing Activities

Receipts
Investment 500,000.00
Bank loan 200,000.00
Payment
cash withdrawal (30,000.00)
Net cash from Financing Activities 670,000

Cash balance at the end of the month PHP 840,500.00

For the cash flows, please refer on the journalizing or Cash
posting.
Date Explanation J.R Debit Credit
Where the cash came from or intended for.
financing 1-Sep Investment J-1 500,000
investing 1 Purchased J-1 300,000
operating 1 Payment J-1 30,000
financing 2 Borrow J-1 200,000
operating 4 Payment J-1 18,000
investing 5 Purchased J-1 20,000
operating 10 Payment J-1 5,000
operating 11 Received J-1 200,000
operating 15 Payment J-1 2,500
operating 17 Received J-1 250,000
financing 23 Withdrawl J-1 30,000
operating 25 Received J-1 100,000
operating 30 Payment J-1 4,000
Acct. no.: 100
Balances
Debit Credit
500,000
200,000
170,000
370,000
352,000
332,000
327,000
527,000
524,500
774,500
744,500
844,500
840,500
 Closing Journal Entry
Page no. 3
Date Account Title & Explanation PR Debit Credit

2014
Sept. 30 Painting revenue 400 350,000
Income summary 302 350,000
To close revenue account

30 Income summary 302 47,400

Salaries expense 500 2,500
Utilities expense 501 4,900
Bad debts expense 506 2,500
Depreciation expense - transportation 505 10,000
Art Supplies expense 502 3,000
Rent expense 503 20,000
Insurance expense 504 4,500
To close expenses accounts

30 Income summary 302 302,600

Ong, Capital 300 302,600
To close income summary account

30 Ong, Capital 300 30,000 Go back to posting - to

the the revenue, expe
Ong, drawing 301 30,000 income summary and d
To close drawing to capital
730,000 730,000
 Go back to posting - to close
the the revenue, expenses,
income summary and drawing
accounts
 Niko Ong Art Gallery
Post Trial Balance
September 30, 2014

Cash PHP 840,500

Accounts receivable 50,000
Art supplies 9,000
Prepaid rent 10,000
Prepaid Insurance 13,500
Transportation equipment 300,000
Office equipment 50,000
Accumulated depreciation - transpo equipment PHP 10,000
Allowance for bad debts 2,500
Accounts payable 37,000
Notes payable 200,000
Utilities payable 900
Unearned painting revenue 250,000
Ong, Capital 772,600
PHP 1,273,000 PHP 1,273,000