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The unadjusted trial balance of Lakbay Tours as of December 31, 2018 is shown below:
1676596787224.png


Ted Solomon, the owner, made an additional investment of P100,000 on March 1, 2018. On December 31, 2018, the following data were accumulated for use in making the adjusting entries:

  1. The company received an 18% P16,000 note from a key customer dated November 16, 2018.
  2. The prepaid rent has a beginning balance of P54,000 representing payment made for six month’s rent. During 2018, another two rent payments were made: P20,000 on June 30 and P19,000 on December 30. It is the policy of the lessor that rental be paid in advance for six months.
  3. The company bought all of its equipment on January 1, 2016. The equipment has an estimated total residual value of P12,000. The company uses the straight-line method of depreciation. Hint: Determine the annual depreciation based on the total accumulated depreciation and the
    acquisition date.
  4. Salaries earned by casual employees but unpaid and unrecorded amounted to P4,000.
  5. P800 unused office supplies remain on hand.
  6. 3% percentage tax due on December is based on gross quarterly receipts of P103,000.
  7. The company received tour revenues in advance on December 1 of which 80% has been earned.
  8. Solomon decided to write-off P15,000 accounts receivable which has been outstanding for two years and the client cannot be contacted anymore.
Other accounts that will be used are as follows:
104 Interest Receivable 602 Bad Debt Expense
307 Salaries Payable 603 Depreciation Expense – Office Equipment
605 Rent Expense 604 Office Supplies Expense
 

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