APPLICATION Prepare the adjusting entry for each of the following for the year ended December 31, 2014. 1. Paid Trio Insurance Co. P33, 000 one year car insurance to commence August 1, 2014. The amount of premium was debited to Prepaid Insurance. 2. Borrowed P200, 000 from Metro Bank issuing a one-year note with 12% annual interest on April 30, 2014. 3. Bought P20, 000 equipment with five- year estimated life and a salvage value of P2, 000. Depreciation is computed on a straight- line basis. 4. Received P51, 000 cash advance from a customer for one year of services to be rendered starting June 30, 2014. The amount was credited to Unearned Service Income. 5. Purchased P7, 100 supplies at the beginning of the year. Supplies remaining at the end of the year amounted to P2, 900. Use the asset method 6. Accounts receivable has a balance of P130, 000. It is estimated that P5, 000 of this is uncollectible.

APPLICATION Prepare the adjusting entry for each of the following for the year ended December 31, 2014. 1. Paid Trio Insurance Co. P33, 000 one year car insurance to commence August 1, 2014. The amount of premium was debited to Prepaid Insurance. 2. Borrowed P200, 000 from Metro Bank issuing a one-year note with 12% annual interest on April 30, 2014. 3. Bought P20, 000 equipment with five- year estimated life and a salvage value of P2, 000. Depreciation is computed on a straight- line basis. 4. Received P51, 000 cash advance from a customer for one year of services to be rendered starting June 30, 2014. The amount was credited to Unearned Service Income. 5. Purchased P7, 100 supplies at the beginning of the year. Supplies remaining at the end of the year amounted to P2, 900. Use the asset method 6. Accounts receivable has a balance of P130, 000. It is estimated that P5, 000 of this is uncollectible.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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