Instructions. 1. Prepare the general journal entries DATE TRANSACTIONS 1/2/16 Invested PHP500,000 to his business. The trade name of the business was “MR. LABANDERO” 1/3/16 Hired Allan and Allie who will manage his business 1/4/16 Collections from various customers for the day - PHP3,000 1/5/16 Purchase store supplies from Labada Store - PHP10,000 1/7/16 Collections from various customers for the day - PHP8,000 1/8/16 MR. LABANDERO entered into an exclusive contract with Sikat Hotel where the business will do all the laundry of the hotel. 1/9/16 Sikat Hotel availed the services of MR. LABANDERO amounting to PHP15,000. Payment will be made on January 20, 2016. 1/10/16 Collections from various customers for the day - PHP12,000 1/12/16 Purchase a washing machine amounting to PHP50,000 1/15/16 Collections from various customers for the day - PHP20,000 1/19/16 Paid electricity bill for the month amounting to PHP18,000 1/20/16 Received payment from Sikat Hotel amounting to PHP15,000 1/21/16 Paid salaries of Allan and Allie - PHP15,000 1/22/16 Mr. Laban Deyro needed money for the hospitalization of his son. He withdrew PHP18,000 from the business. 1/25/16 Paid airfare ticket of PHP1,500 for the travel of Mr. Deyro to Manila to negotiate a contract with Sosyal Hotel 1/26/16 Paid taxes to the City of Iloilo, PHP4,000 1/27/16 Purchased office supplies amounting to PHP12,500 1/28/16 Collections from various customer for the day - PHP5,000 1/29/16 Sosyal Hotel availed the services of MR. LABANDERO amounting to PHP15,000 payable on Feb 25, 2016.
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
Instructions.
1. Prepare the general
DATE TRANSACTIONS
1/2/16 Invested PHP500,000 to his business. The trade name of the business was “MR.
LABANDERO”
1/3/16 Hired Allan and Allie who will manage his business
1/4/16 Collections from various customers for the day - PHP3,000
1/5/16 Purchase store supplies from Labada Store - PHP10,000
1/7/16 Collections from various customers for the day - PHP8,000
1/8/16 MR. LABANDERO entered into an exclusive contract with Sikat Hotel where the business will
do all the laundry of the hotel.
1/9/16 Sikat Hotel availed the services of MR. LABANDERO amounting to PHP15,000. Payment will
be made on January 20, 2016.
1/10/16 Collections from various customers for the day - PHP12,000
1/12/16 Purchase a washing machine amounting to PHP50,000
1/15/16 Collections from various customers for the day - PHP20,000
1/19/16 Paid electricity bill for the month amounting to PHP18,000
1/20/16 Received payment from Sikat Hotel amounting to PHP15,000
1/21/16 Paid salaries of Allan and Allie - PHP15,000
1/22/16 Mr. Laban Deyro needed money for the hospitalization of his son. He withdrew PHP18,000
from the business.
1/25/16 Paid airfare ticket of PHP1,500 for the travel of Mr. Deyro to Manila to negotiate a contract
with Sosyal Hotel
1/26/16 Paid taxes to the City of Iloilo, PHP4,000
1/27/16 Purchased office supplies amounting to PHP12,500
1/28/16 Collections from various customer for the day - PHP5,000
1/29/16 Sosyal Hotel availed the services of MR. LABANDERO amounting to PHP15,000 payable on
Feb 25, 2016.
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