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Worksheet Problems

The document provides the ledger accounts and balances as of December 31, 2018 for Bernardino Floral Décor Services. It includes assets, liabilities, equity, revenues and expenses. Additional information is provided about various accounts and transactions during the year that require adjustments to the accounts. The required tasks are to prepare a 10-column worksheet to incorporate the adjustments and prepare the final financial statements and notes.

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Claren Sidnne Madrid
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605 views3 pages

Worksheet Problems

The document provides the ledger accounts and balances as of December 31, 2018 for Bernardino Floral Décor Services. It includes assets, liabilities, equity, revenues and expenses. Additional information is provided about various accounts and transactions during the year that require adjustments to the accounts. The required tasks are to prepare a 10-column worksheet to incorporate the adjustments and prepare the final financial statements and notes.

Uploaded by

Claren Sidnne Madrid
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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I.

The books of Bernardino Floral Décor Services showed among others the following accounts and
their balances as at December 31, 2018:

Cash 40,000

Accounts Receivable 75,000

Allowance for Bad Debts 2,500

Notes Receivable 17,500

Prepaid Insurance 3,750

Delivery Truck 325,000

Accumulated Depreciation 22,500

Accounts Payable 125,000

Notes Payable 75,000

Bernardino, Capital 175,000

Bernardino, Drawings 7,500

Service Income 1,400,000

Interest Income 6,250

Rent Expense 192,500

Salary Expense 1,128,000

Gas & Oil Expense 7,500

Supplies Expense 5,000

Interest Expense 4,500

The following additional information was given for you.


a. P500 worth of supplies are still unused at the end of the year.
b. The delivery truck was purchased March 31 of the previous year with an estimated life of 10 years
and salvage value of P25,000.
c. Prepaid insurance represents the balance of a 1-year premium expiring March 1, 2019.
d. The note was received from a customer on November 16, 2018 for` 90 days at 18% interest.
e. Semi-monthly payroll is payable on the 19th day of the month and 4th day of the following month.
Payroll for the period December 16 to 31 amounted to P98,000.
f. Service income represents floral arrangement for the church and the wedding reception. A couple
to be married early January gave an advance payment of P15,000, which was included in the service
income account.
g. The company estimates that 5% of accounts receivable may prove uncollectible.
h. The rent expense balance covers the 11-month period from January to November 2018.
i. The notes payable represents a 30-day P15,000 non-interest bearing note issued to a regular
supplier on December 16, 2018 and a six-month 10% note with a face value of P60,000 issued to
UCPB on September 1, 2018.

Required:
1) 10-column worksheet
2) Financial Statements (including Notes)
II. The bookkeeper of Raphael’s Bicycle Shop presented the following ledger accounts and their
balances as of December 31, 2018:

Cash in Bank 2,700,000

Cash on Hand 50,000

Accounts Receivable 3,000,000

Allowance for Bad Debts 150,000

Notes Receivable 900,000

Merchandise Inventory, 1/1 2,250,000

Prepaid Insurance 157,500

Store Furniture & Fixtures 4,000,000

Accumulated Depreciation – Store Furniture & Fixtures 125,000

Office Furniture & Fixtures 4,500,000

Accumulated Depreciation – Office Furniture & Fixtures 225,000

Accounts Payable 1,000,000

Notes Payable 450,000

Unearned Commissions 60,000

Mortel, Capital 10,697,500

Mortel, Drawings 75,000

Sales 17,800,000

Sales Returns & Allowances 130,000

Sales Discount 70,000

Purchases 10,500,000

Interest Income 25,000

Freight In 150,000

Purchase Returns & Allowances 75,000

Purchase Discounts 50,000

Advertising Expense 225,000

Rent Expense 1,050,000

Salaries Expense 850,000

Utilities Expense 35,000

Interest Expense 15,000


The following additional information for adjustments was given.
j. The allowance for bad debts should be increased to P250,000.
k. The notes received from customers consist of a 30-day 9% note for P700,000 dated December 10,
2018 and a 60-day P200,000 note dated December 5, 2018. No interest has been collected on
these notes.
l. The company has paid on July 1, 2018 insurance premium for a two-year policy effective on that
date.
m.The store furniture & fixtures are depreciated over a useful life of 5 years. Of those on hand as of
December 31, furniture costing P1,500,000 were acquired only on December 1, 2018. The office
furniture and fixtures are to be depreciated at a rate of 20% per annum.
n. Salaries of P137,500 have accrued as of December 31, 2018.
o. The enterprise has paid for a three-month advertising contract on November 1, 2018 for P225,000.
p. The notes payable represents a 60-day 18% note dated December 10, 2018 for which no interest
has yet been paid.
q. The company received commission amounting to P60,000 but only 1/3 of this has been earned.
r. Unsold merchandise, per physical count of December 31, 2018, amounted to 1/4 of the beginning
merchandise inventory.

Required:
1) 10-column worksheet
2) Financial Statements (including Notes)

“Whether you turn to the right or to the left, your ears will hear a voice behind you, saying,
‘This is the way; walk in it.”
Isaiah 30:21

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