CONCEPTUAL

TABLE OF CONTENTS:
FRAMEWORK
& CHAPTER 1:
ACCOUNTING
ACCOUNTING STANDARDS
STANDARDS (PART1) ASSETS
(PART 2)
LIABILITIES
& OWNER'S
EQUITIES

CHAPTER 2:
Learning Resources by:
CONCEPTUAL
#AccountingGroupApproach
FRAMEWORK
#TheAccountant
CHAPTER 3:
#Tutor_Michael
DEBIT & CREDIT
(Part 1) JOURNALIZING

(Part 2) T-ACCOUNTS

(Part 3) BALANCING
Module prepared by:
CHAPTER 4:
PROF. Jhay Heart L.C.
ACCOUNTING
Dela Cruz, IELTSP
RELATIONS
MBA Cdt.
Golden Rule: consumers of its products or services, or

“Never assume unless otherwise as its employees.

stated…” – Acccountants

CHAPTER 1 LUCA PACIOLI – The “Father of

Accounting.”

ACCOUNTING
STANDARDS
FORMS OF BUSINESS
ORGANIZATION

1. SINGLE/SOLE PROPRIETORSHIP
- is a business owned by only one person.
TYPES OF BUSINESS
2. PARTNERSHIP
ORGANIZATION
- is an association of "TWO or MORE"
persons who bind themselves to 1. SERVICE BUSINESS
contribute money, property or industry - This business renders services to
(services) to a common fund, with the customers or clients for a fee.
intention of dividing the profits among Ex. Sale of Services (e.g. Hair-Cut…)
themselves.
2. MERCHANDISING /
3. CORPORATION TRADING BUSINESS
- is an artifical being body (not natural, - This business buy goods or commodities
but like human being) created by the and sell them at a profit.
operation of the LAW. Ex. Sale of Goods (e.g. Buy&Sell)

4. COOPERATIVE 3. MANUFACTURING BUSINESS

- is a legal entity owned and - This business makes "finished goods"
democratically controlled by its members. from "raw materials" or unassembled
Members often have a close association parts. It "produces" the goods that it
with the enterprise as producers or
sells. Again, our POINT of VIEW is the
Ex. Sale of Goods (e.g. Produce&Sell) "Business" (not the owner po)
Magkaiba/hiwalay ang "Business" at
"Owner" ("Entity" Concept)

1. BUSINESS = as if an "Artificial being"

ACCOUNTING
STANDARDS (our POINT OF VIEW)
(BASIC FORMULA) 2. OWNER = “Human being”

COMMON_MISTAKE
BASIC ACCOUNTING Ang "Business" at ang "Owner" ay
EQUATION IISA.
*MALI yan Nak. Para maintindihan
A = L + OE
natin ang Accounting Equation
Assets = Liabilities + Owner's Equity (A=L+OE), ang una dapat nating isipin
P100 = P60 + P40 ay magkaiba ang "BUSINESS" at ang
"OWNER."
CHARACTERS: Ex.
(Remember the word “B.A.L.O.”) Business (Ikaw) = Buy & Sell ng damit.
a. BUSINESS = "Ikaw"
~kung ikaw si BUSINESS, kailangan mo ng
b. ASSET = Pag-aari "ng business" "pera" pambili ng damit.
c. LIABILITY = Utang "ng business"
Q.
sa iba (Ex. Bank)
Saan manggagaling ang pera?
d. OWNER'S EQUITY = "Utang" "ng
business" sa may-ari (owner) ANS.
a. Mangungutang sa iba (Ex. Bank) P60
Tinawag po nating "Utang" or "Obligation" b. "Mangungutang" sa Owner P40
ang Owner's Equity/Capital dahil ang P60 + P40 = P100
point of view natin ay si "Business" Ang pera na ngayon ni "Business" ay
P100
Dahil na kay BUSINESS ang mga
BUSINESS:
ininvest/contributions/puhunan ni Owner,
A = P100 (Pera/Asset)
parang may "Utang" si BUSINESS dahil
L = P60 (“Utang” sa Bank)
may "obligation" siyang ibalik ang mga yan
OE = P40 ("Utang" sa Owner)
sa may-ari/owner.
In simple words, ang Pera ng Business
na P100 (ASSET) ay galing sa :
 - utang sa Bank P60 (LIABILITY), 1. "Current" Assets
- utang sa Owner P40 (OE) 2. "Non-Current" / Fixed Assets
A = L + OE
P100 = P60 + P40 CURRENT = SHORT-TERM
(generally, "1 year or less")
REMINDER:
- In Form, parang ISA lang ang NON-CURRENT = LONG-TERM
"Business" at "Owner" (generally, "more than 1 year")
- Pero in Substance, IKAW lang si Kaya siya "Long-term" kasi;
"BUSINESS" (at "parang" -matagal ang buhay niya and/or
pinautang ka lang ng sarili mo) -matagal nagagamit or mapakinabangan.
Ex. Building
ACCOUNTING TYPES OF
STANDARDS (Part 1) CURRENT ASSETS:

1. Cash

ASSETS 2. Accounts Receivable

3. Notes Receivable
4. Accrued Income
5. Advances "TO" Employess
PAALALA: "Very Challenging…"
(Advances to Suppliers*)
~ BAWAL basahin ng mga taong ayaw
6. Merchandise Inventory
magka-IDEA sa Accounting :) 7. Trading Securities (Marketable
It takes time to Learn and Understand. Securities) (Fair value through
The key is "REPETITION.” Profit or Loss) (Short-term
Basahin lamang ng maraming beses. :) Investment)
You need Patience, Perseverance, Sipag, 8. Allowance for Doubtful Accounts
(Allowance for Bad debts)
Tiyaga (at Dasal na rin.)
9. Prepaid Expenses
TIP:
a. (Office Supplies /
"Don't MEMORIZE, INTERNALIZE." Store Supplies)
b. (Prepaid Rent,
Ready ka na Nak? Prepaid Salaries, etc.)
Game na? 10. Other "current" assets
Then lets begin…

ASSETS:
TYPES OF
Ang ASSET ay “any properties of NON-CURRENT ASSETS or
the company” na nahahati sa dalawang FIXED ASSETS:

SUBSETS: 1. PPE - Property, Plant, & Equipment

 2. Land
Ex. Ang "line of business" mo ay
3. Building
"pagpapautang." Nagpautang ka ng P1,000
4. Machinery and Equipment at walang natira sa iyo.
5. Furniture & Fixtures
6. Accumulated Depreciation(Building) Q. Magkano na ang asset mo?
Zero o P1,000 pa rin?
7. Acc.Dep. (Machinery & Equipment) ANS. P1,000 pa rin.
8. Acc.Dep. (Furniture & Fixtures)
Oo, nawala yung P1,000 kaya parang wala
TAKE NOTE: walang Accumulated
ng Asset PERO nagkaroon ka naman ng
Depreciation (Land)
"pautang". Ang tawag sa pautang na yan ay
"ACCOUNTS RECEIVABLE".
9. Intangible Assets
“Receivable” kasi may "mare-receive"
10. Other "noncurrent" assets kang bayad o pera.
RATIONALE FOR CURRENT ASSETS:

3. "NOTES RECEIVABLE"
1. "CASH"
- Ito ang tawag sa account na ipinautang
A = L + OE
pero may “kasulatan” (or “Promissory
100 =60 + 40
Note”) at kumikita ng “interest.”
Si Business (Ikaw) ay may perang P100
4. “ACCRUED INCOME"
ngayon. San galing?
- “Earned but not yet received.”
(P60, utang sa “bank”)
Ito yung “kumita ka na”, pero “hindi pa
(P40, utang sa “owner")
natatanggap” yung pera.
Q. Ano ang tawag sa P100?
ANS. “CASH” Ex.
CASH = P100 Nagpapaupa ka (ikaw ang may-ari) ng isang
“room for rent.”
Q. Bakit siya naging “TYPE ng CURRENT Ang paupa mo ay P2,500 per month.
Asset”? Walang ka pang natatanggap na pera kahit
ANS. kasi pwede mo gastusin "anytime" magkano… (Advance man or Deposit)
(1 year or less) Lumipas ang isang buwan.
May kinita ka nang P2,500 sa upa.
2. "ACCOUNTS RECEIVABLE" (Pautang) PERO… “hindi mo pa natatanggap yung
- “Receivable” kasi may "mare-receive" pera.”
kang bayad o pera na galing sa: Ito ay isang uri din ng RECEIVABLE
a. nangutang sayo, (Parang ACCOUNTS RECEIVABLE) dahil
b. bumili ng products sa’yo, o may "mare-receive" kang pera.
c. "services rendered" na hindi pa
nakokolekta mula sa customer. 5. "ADVANCES TO EMPLOYEES"
- Ito ang tawag sa account na pinautang sa P120-P100=P20
empleyado. Ang pambayad ay ibabawas na
lamang sa kanyang sweldo. Ang tawag po sa sobrang P20 is either;
a. Interest (pag debt security) or
6. "MERCHANDISE INVENTORY" b. Dividend/Price Appreciation (pag
Si Business (Ikaw), ay may P100. equity security)
Pinambili mo ng "DAMIT (assuming ang *Simple Illustration lang ito :)
business mo ay "BUY & SELL" or (Wag muna sa komplikado)
"Merchandising") para ibenta sa mas
mahal na halaga. Kailan siya naging TRADING
BUY: Damit P100 SELL: P120 SECURITIES?
P120-P100=P20. Kumita ka ng P20. Yun ay nung time na “nag-invest” ka.
Q. Ano ang tawag dun sa DAMIT na Nag-invest ka at nawalan ka ng pera pero
binibenta mo? nagkaroon ka naman ng "short-term
Ans. MERCHANDISE INVENTORY investment" (parang pautang din) na ang
7. "TRADING SECURITIES" tawag ay TRADING SECURITIES.
(Fair value through Profit or Loss) 8. "ALLOWANCE FOR DOUBTFUL
(Marketable Securities) ACCOUNTS"
(Short-term Investment)
Si Business (Ikaw) ay may P100 ngayon. May experience ka ba dati na laging
Ang P100 ay inINVEST. "kalahati" lang kung magbayad ng utang
sa’yo itong kaibigan mo?
Pag sinabing ininvest, parang "PAUTANG"
din yan. Ipapahawak mo muna sa iba yung Ex. P100 ang inutang, 50 lang pag binalik.
pera mo para kumita or madagdagan Ngayon, nanghiram siya ulit sa’yo ng 100.
(TAKE NOTE: pwede rin na mabawasan)
Pwede ka mag-invest(or magpautang) sa Sa tuwing ia-“anticipate” mo – [na yung
dalawang ito: “kalahati ng 100” (P50) na hindi niya na
naman mababayaran] - ay tinatawag na,
a. DEBT Securities (dito, pwede Allowance for Doubtful Accounts.
madagdagan ang pera mo ng “Interest”
b. EQUITY Securities (dito, pwede
madagdagan ang pera mo ng “Dividend” 9. "PREPAID EXPENSE"
and “Price Appreciation” - PAID but “not yet incurred.” Ito yung
"Bayad na" pero "di pa nagagamit."
EX.
Nag-invest ka ng P100. So nawalan ka ng
Ex. Si Business (Ikaw) ay may P100.
P100. After ng ilang buwan, binawi mo na
Pumunta ka sa 7eleven at pinambili mo ng
yung pera at naging P120.
LOAD na gagamitin mo for the business.
Paki compute.
Q. Ano yung tawag sa P100 na load?
Magkano po ang sobra?
ANS. Prepaid Expense
 “Walang ganun Mars” sa Accounting.
Kung nag-text ka at nabawasan piso (P1),
ang Prepaid Expense mo ay “P99 na lang.” APPRECIATE
Dahil nga, ang Prepaid Expense ay yung - In accounting sense, it means "increase
amount ng load na "HINDI MO PA in value."
NAGAGAMIT". Okay?
Ex.
Ganun din pag bumili ka ng ballpen, pencil, Bumili ka ng Land (Lupain) sa probinsya
or yung mga nabibiling "Supplies" sa worth P100.000.After 10 years, ang value
National Bookstore, "PREPAID ay naging P1.000.000.
EXPENSE" din ang tawag dun. ;)
Kung ang amount ng asset ay “tumaas”
Tinatawag ang “Supplies” sa Accounting APPRECIATE ang tawag.
Jargon or Accounting term as “Office
Supplies” or “Store Supplies.” Kaya ang LAND ay isang klase ng PPE na
nag-a-APPRECIATE.
RATIONALE for NON-CURRENT
ASSETS or FIXED ASSETS: Q: ANO naman yung mga PPE na nagde-
DEPRECIATE? (Depreciate means lumiliit
ang value habang tumataga.l)
1. "LAND" ANS:
- Ito ang "FAVORITE asset" ko kasi ang 2. “BUILDING” (alam niyo na ito)
ganda ng meaning niya. 3. “OFFICE EQUIPMENT”
[ L. A. N. D. ] Ex. Computer, Machinery, Aircon, etc.
L-ove (of GOD) 4. “FURNITURE & FIXTURES”
A-lways "Appreciate" and Ex. Table, Chair, Wall decorations
N-ever
D-epreciate Ano naman ang "ACCUMULATED
DEPRECIATION"?
Q. Ito ba talaga ang meaning ng Land? - Ito yung naipon or "na-aacumulate" na
ANS. Hindi.(so It’s a PRANK! jajajaja) “pagbaba” o “pag-depreciate” ng VALUE.

Cut to the chase… Ex. BUILDING

With these Mnemonics ang magli-lead Cost: P100
sa’yo to come up w/ “Acctg.Jargons” Life: 5 years
like: “APPRECIATE” and “DEPRECIATE.” P100 / 5 years = P20 (Depreciation)
Ano ba ito?

APPRECIATE:
~ Ito ba yung pag may ginawa kang mabuti
sa jowa mo, tapos na-“APPRECIATE” niya?
HINDI. Mali yun. Irrelevant yun ha.
Kung napansin mo, naubos or naging zero
ang value sa Year 5. Kaya ang tawag na sa End of Year: Remaining Value
BUILDING ay "FULLY DEPRECIATED".
Or simply, “wala nang value.” Year 1: P100-P20 = P80

5. "INTANGIBLE ASSETS" Year 2: P80-P20 = P60

- Ex./s
a. Franchise Year 3: P60-P20 = P40
b. Trademark (Logo, Brand name)
c. Patent (inventions) Year 4: P40-P20 = P20
d. Copyright (Books)
ACCOUNTING Year 5; P20-P20 = P0

STANDARDS (PART 2) Ganun din sa Accounting Topics Nak.

Dapat ay may gagawin ka para
LIABILITIES & maintindihan mo siya. ☺

OWNER'S *********************************
YOU:
EQUITY “Prof.Heart,
Q: Pag wala ka nang maintindihan at di di po ako maka-relate.
ka na nag-e-enjoy sa ACCOUNTING SINGLE pa po ako eh.”
TOPICS, “di na ba para sayo ang PROF. ❤:
Accountancy?” Edi JOWAin mo muna si
ACCOUNTING!
*********************************
A: Let me give you an ANALOGY. Game ka na ba Nak?
May "Boyfriend or Girlfriend" ka. GAME NA!
Madalas kayong mag-away kasi hindi na
kayo magkaintindihan.
Pag ganun ba, hindi na kayo pwedeng
magkatuluyan?
-Aba syempre, pwede pa rin Nak.
Simulan natin sa
Kailangan mo lang “pag-aralan” ang
LIABILITIES.
ugali niya, at dapat marunong kang
"mag-ADJUST" at SUBSETS of LIABILITIES
"mag-BALANCE." ❤
1. Short-term Liabilities
- babayaran within 1 yr or less.
 2. Long-term Liabilities PAYABLE - Babayaran pa lang /
- babayaran beyond 1 year (hindi pa bayad)
(more than 1 year.) - In paying Notes Payable, may "dagdag-
bayad" na "interest" (Interest Expense)

3. ACCRUED EXPENSE
TYPES OF - "Hindi pa bayad" na "Gastusin."
SHORT-TERM LIABILITIES ACCRUED - Hindi pa bayad
EXPENSE – Gastusin
1. Accounts Payable Ex. MERALCO Bill
2. Notes Payable [Hindi ka pa bayad sa gastusin
3. Accrued Expense (electricity) na nagamit or na-consume ng
4. Unearned Income business mo.]

4. UNEARNED INCOME
(Advances from Customers)
TYPES OF
LONG-TERM LIABILITIES - Ang "Unearned Income" ay isang
liability. Utang siya kasi may
1. Notes Payable natanggap kana na bayad pero hindi ka
pa nagrerender ng service.
2. Bonds Payable
3. Mortgage Payable Ex.Nagbayad na ng P100 si Customer
pero "BUKAS" pa siya magpapagupit.

Business (Ikaw)
- nakatanggap ng CASH (Pera)
- pero hind pa INCOME
RATIONALE FOR kasi "BUKAS" pa magpapagupit.
SHORT-TERM LIABILITIES:

RATIONALE FOR
1. ACCOUNTS PAYABLE
- "Utang" na "hindi pa bayad." LONG-TERM LIABILITIES:
ACCOUNTS - Utang
1. NOTES PAYABLE (Long-term)
PAYABLE - Babayaran pa lang /
Pareho sa “No.2”, PERO… BABAYARAN
(hindi pa bayad)
NG "HIGIT" SA ISANG TAON. Kaya
nga “Long-term.” Nakasunod? 
2. NOTES PAYABLE (Short-term)

NOTES – “Utang na may kasulatan” 2. BONDS PAYABLE

(Promissory Note) Pangmatagalang kontrata ng
pagkakautang. Mga lima hanggang sampung
taon bago bayaran. "BASIC" ACCOUNTING EQUATION

3. MORTGAGE PAYABLE A = L + OE

MORTGAGE: Utang na may SANLA Assets = Liabilities + Owner's Equity

PAYABLE: Babayaran pa (hindi pa bayad) P100 = P60 + P40
… Di ba “same” lang Nak sa “Part 1.”
Ex. But this time, ibahin natin ang
Bumili ka ng LAND pero di pa bayad “EQUATION”…
(Utang - Mortgage Payable)
A - L = OE
*pero yung Land ay naka-“SANLA” Assets - Liabilities = Owner's Equity
(Collateral) P100 - P60 = P40

Q. Anong meaning ng naka- SANLA Nasundan mo ba Nak?

(Collateral)? **
A. Pag hindi nakabayad sa utang na Ang ibig sabihin nito ay:
Mortgage Payable, yung LAND (Collateral)
Sa ASSETS na P100,
ay “ibebenta.” Yung pera na galing sa
benta ay gagamitin para mabayaran na "Priority" na mabayaran muna ang
yung Utang na Mortgage Payable. LIABILITIES sa Creditors na P60.
Kaya ang matitira na lang para sa OWNER
*Kung halimbawang nag-LOAN naman sa ay P40.
bangko, pwede ring gawing Collateral ang
**
other “real properties” ng business.
Kung hahatiin or ibi-break down natin
yung natira sa owner na P40, ito ay ang
mga sumusunod (1 to 5):
(But this time,
lets change our POINT OF VIEW…)

OWNER'S EQUITY (a.k.a. “Capital”) (Isipin mo naman ngayon na IKAW ang

"OWNER")
- “Initial Investment” by the owner.
- “Additional Investment” by the owner. (Gagawin lang natin 'to para mas madali
- “Revenue / Income” of the business. mong maunawaan)
- “Expenses” of the business. Kung ikaw si OWNER, tanungin mo lang
- “Drawings / Withdrawal” by the owner. ang sarili mo:
(Isa-isahin natin yan Nak mamaya, okay?) "Kung ihihinto ko na ang Business ko, ano
kaya ang mababawi ko galing sa business
*********************************
ko? (Balik tayo sa Definition ng
OWNER’s EQUITY…)
1. “Initial Investment” by the owner. (Common sense between the two syempre,
better ang Net INCOME.)
- Nang magtayo ka ng negosyo, yan ang Simple MATH lang ang Accounting di ba?
kauna-unahang binigay mong puhunan.
(Pwedeng pera, pwedeng gamit, etc.)
5.“Drawings / Withdrawal” by the owner.

- Investments or contributions mo ito Parang sa ATM card. Pag nag-withdraw ka,

"before the business operations." may kinuha ka.
DRAWINGS or Temporary withdrawal
2. “Additional Investment” by the owner. - ito ang tawag pag ang kinuha mo ay yung
“Kita” ng business mo. (Net INCOME)
- “Dagdag-puhunan.” PERMANENT WITHDRAWAL
- ito ang tawag pag ang kinuha mo ay ang
- Binigay mo ito, “Investment” mo. (yung No.1 & No.2)
"during the business operations".

Ex.
Maaaring sa unang taon ay sobrang dami
Initial investment P50
agad ng customers mo kaya naman
Additional investment P30
nagdagdag ka ng puhunan.
Revenue P20
Expenses P15
3. “Revenue / Income” of the business.
Drawings P45
- "Kita" ng business mo.
- Iba ang Revenue sa Income ha. *
Revenue = Sales (Benta) Q. How much ang NET INCOME?
Income = Earnings(Kita,Tubo,Profit) ANS. Revenue - Expenses = Net Income
However, “pinagsasama” na lang natin sila (20 - 15 = 5)
dahil ang priority dito ay ma-contrast sila
Answer is P5.
sa Expense. In equation,
(Revenue / Income - Expense)
Q. How much ang OWNER'S EQUITY?
4. “Expenses” of the business.
- "Gastusin" ng business mo ANS.
[Beginning Capital (Initial investment) +
Sa No.3 & No.4,
Additional investment + Net income] –
ang dapat na goal ay “mas malaking
Drawings
REVENUE kaysa EXPENSE.”
= Ending Capital (Owner's equity)
[50 + 30 + 5] - 45 = P40
Ex.
a) Revenue - Expense = Net INCOME Answer is P40.
20 - 15 = 5 *YUNG P40, yan na lang ang portion ng
b) Revenue - Expense = (Net LOSS) asset na pwedeng MABAWI ng owner.
15 - 20 = -(5) **
Supposedly, ang "mababawi" niya dapat ay Nabenta for P110 CASH.
yung INITIAL AND ADDITIONAL Hence,
INVESTMENT niya (50+30) at yung NET Ibabayad sa Liabilities = P60
INCOME ng business (5). Ibabayad sa Owner = P50 (P10 tubo)
50 + 30 + 5 = 85. NOTE: *Basta, sa kahit magkano mo pa
siya nabenta , ang “Priority” dito ay dapat
Kaya lang, may "actual" DRAWINGS
munang mabayaran ang “LIABILITIES”
siyang P45.
bago ang “Owner.” Nakasunod ba Nak?
Kaya ang natira na lang is 40 (85-45).
*********************************
*Oh di ba Nak!
Plus(+) Minus(-) lang pala ang Accounting. NOTE THESE FORMULAS:
BASIC!!! Kayang-kaya mo!
** 1. Net Income or (Net Loss) =
(Revenue and Income – Expenses)
If ever mag-decide ang owner na ihinto na
2. Ending Capital (Owner's equity) =
ang business ngayon, P40* na lang ang
{[Beginning Capital (Initial investment) +
mababawi niya.
Additional investment + Net income] –
*Pero pwede pang mabago ang amount na Drawings}
yan pag, "na-convert into cash" ang mga Ending Capital [Net Income or (Net Loss)]
ASSETS bago ibalik sa owner. a. Ending Capital (Net Income) =
Yan ay dahil sa tinatawag na FAIR VALUE {[Beginning Capital + Additional
and NET REALIZABLE VALUE ng assets Investment (- Permanent Withdrawal) +
(in simple words, "Today's Value"). Net Income] – Drawings}
b. Ending Capital (Net Loss) =
([Beginning Capital + Additional
HALIMBAWA:
Investment (- Permanent Withdrawal)
*Let's go back to the POINT OF VIEW - Net Loss] – Drawings}
of the "Business" (Basic Acctg. Equation)
A = L + OE REVENUE or INCOME vs. EXPENSE
Panindang damit = Liabilities + Owner's
equity
REVENUE = Sales (Benta)
100 = 60 + 40.
Yung halaga ng panindang damit ay P100. INCOME = Earnings (Kita,Tubo, Profit,
Q. Pwede bang ipambayad yung Damit Mark-up)
(P100) sa LIABILITIES (P60) at sa Ex.
OWNER (P40)? Ang Business ay "Salon".
ANS. Hindi. “Walang ganun Mars…” May isang empleyado na ang pangalan ay
Ang gagawin mo ay, ibebenta yung damit "Gema".
para maging PERA or CASH. At yung cash
Nang mag-open ang Salon, may pumasok na
na yun ang ibabayad sa LIABILITIES at
isang customer at nagpa-haircut.
sa OWNER. Gets?
Ex. Cost ng Damit: P100
Pagtapos ay nakakolekta ang "Business" ng FORMS OF BUSINESS
P100 dahil sa HAIRCUT. ORGANIZATION
Q.Ano ang tawag sa P100?
1. SINGLE/SOLE PROPRIETORSHIP
ANS. REVENUE / INCOME.
NOTE: “pinagsasama” na lang natin ang - is a business owned by only one person.
Revenue / Income dahil ang priority dito
2. PARTNERSHIP
ay ma-contrast sila sa Expense. Na-
mentioned na to kanina. ;) - is an association of "TWO or MORE"
persons who bind themselves to

EXPENSE = Costs or Gastos contribute money, property or industry

(services) to a common fund, with the
Ex. intention of dividing the profits among
Dahil nagtatrabaho si "Gema" sa Business, themselves.
kailangan siyang swelduhan. Ang "binayad"
kay Gema ay P70. 3. CORPORATION
- is an artifical being body (not natural,
Q. Ano ang tawag sa P70? but like human being) created by the
operation of the LAW.
ANS. EXPENSE.
4. COOPERATIVE
Hence,
- is a legal entity owned and

(Revenue / Income - Expense) democratically controlled by its members.

Members often have a close association
REVENUE / INCOME: P100
EXPENSE: - P70 with the enterprise as producers or
consumers of its products or services, or
NET INCOME: P30
as its employees.

LUCA PACIOLI – The “Father of

Chapter 2 Accounting.”

BASIC
ACCOUNTING
REMINDER:
(Please be adivised that the Chapter 1 w/
Part 1&2 are played only as the
“introduction” of this subject. This time,
we are now dealing with the subject
itself…)
 business.

2. LIABILITIES
- are defined as present OBLIGATIONS
TYPES OF BUSINESS of an enterprise arising from past
ORGANIZATION transactions or events.

1. SERVICE BUSINESS ~In simple terms, these are the financial

- This business renders services to obligations or DEBTS of the business.It
is also described as CLAIM of the
customers or clients for a fee.
CREDITORS on the Assets of the
Ex. Sale of Services (e.g. Hair-Cut…)
enterprise.
2. MERCHANDISING /
3. OWNER'S EQUITY/CAPITAL
TRADING BUSINESS
represents the CLAIM of the OWNER on
- This business buy goods or commodities the Assets of the business. It is the
and sell them at a profit. RESIDUAL INTEREST in the Assets of
Ex. Sale of Goods (e.g. Buy&Sell) the business after deducting all its
liabilities.
3. MANUFACTURING BUSINESS NOTE: Owner's Equity/Capital
- This business makes "finished goods" consists of the following:
from "raw materials" or unassembled a. "Owner's Capital"
parts. It "produces" the goods that it b. "Owner's Drawing"
sells. **********************************
Ex. Sale of Goods (e.g. Produce&Sell)
NOTE: In “Basic” Accounting, mind only the;
LEFT SIDE: RIGHT SIDE:
- Assets, - Stocks/Share (OE)
- Expenses, and
STATEMENT of - Liabilities,
FINANCIAL and
STATEMENT of FINANCIAL - Drawings
PERFORMANCE- (Revenue / Income (Y)
INCOME STATEMENT)
POSITION (BALANCE SHEET) as “Losses and Gains” will be discussed in
(Gain = RoI – Exp)
(A = L + OE) your “Advance Accounting.” So Don’t mind 
Net Income=Revenue or Income-Expense
Assets = Liabilities = Owner’s Equity

1. ASSETS 1. REVENUE / INCOME (Y)

- are defined as RESOURCES controlled - is the gross INFLOW of economic
by the enterprise as a result of past benefits during the period in the form of
transactions and events and from w/c INFLOWS or enhancements on assets or
future economic benefits are expected to decrease in liabilities that result in
flow to the enterprise. In simple terms, INCREASE in equity, other than those
these are PROPERTIES owned by the relating to contributions from the owner
or owners. (Opposite ito ng Expense. Now,
 learn to contrast these two and see for
[D.E.A.L.] [G.I.R.L.S.]
yourself.  )

D - rawings G - ains
2. EXPENSE
- is defined as the gross OUTFLOW of
economic benefits during the period in E - xpenses I – ncome (Y)
the course of ordinary activities when
these OUTFLOWS result in DECREASE A - ssets R - evenue

CURRENT NON-CURRENT / L- osses L - iabilities

ASSETS FIXED ASSETS
S- tocks / Shares
Cash PPE (Owner’s Equity)

Accounts Receivable Land

ACCOUNTING “NAMES”
a.k.a. “Financial characters” or
Notes Receivable Building
“Accounting Entries.”
- these are the elements under the
Accrued Income Office Equipment “subsets of a specific Accounting Titles.”

Advances to Employee Furniture & Fixtures

ACCOUNTING NAMES FOR
ASSETS
Merchandise Inventory Acc.Dep. (Bldg.)
ACCOUNTING NAMES FOR
Trading Securities Acc.Dep. (M&E.) EXPENSE

Allowance for Doubtful Accounts Acc.Dep. (F&F) COMMON ESTIMATED

Prepaid Expenses Intangible Assets Cost of Sales Doubtful Account Exp.

Office/Store Supplies Other Non-Current / Supplies Exp. Depreciation Exp.

Fixed Assets
Other Current Assets Salaries & Wages Exp.

in equity other than those relating to Insurance Exp.

distribution to owners.
~In simple terms, these are COSTS Taxes & Licenses Exp.
incurred to produce income/revenue.

FINANCIAL CHARACTERS:
THE ACCOUNTING TITLES ACCOUNTING NAMES FOR
 LIABILITIES 5. ADVANCES TO EMPLOYEES
6. MERCHANDISE INVENTORY
ACCOUNTING NAMES FOR
SHORT-TERM LONG-TERM
OWNER’s EQUITY (CAPITAL)
LIABILITIES LIABILITIES

ACCOUNTING NAMES FOR LEFT RIGHT

Accounts Payable
REVENUE / INCOME (Y)
Owner’s
Notes Drawing
Payable (short) Owner’s
Notes Capital
Payable (long)
SALES SERVICE (a.k.a.TemporaryWithrawal) Initial Investment
Accrued Expense (a.k.a. Bonds Payable
Sales Income Service Income Permanent Withrawal
Utilities Expense) Owner’s
Additional
Unearned Income Investment
Mortgage Payable
Interest Income Professional Fees

“Current Portion” of
Gain on Sales of Rent Income
Long-Term Debt
other Assets
7. TRADING SECURITIES
ACCTNG. NAMES for “ASSSETS”
8. ALLOWANCE FOR DOUBTFUL
ACCOUNT (Contra Asset)
SUBSET: “CURRENT ASSETS”
NOTE: "CONTRA-ASSET Account” is
the opposite of "ADJUNCT" account.
1.CASH (Money)
In layman's term,
- is any medium of exchange. (Pera)
CONTRA = deducted
- pwedeng coins, buong pera, or checks.
ADJUNCT = added (Ex. Freight In)
- Types:
a. Cash on Hand – perang nasa’yo.
9. PREPAID EXPENSES
b. Cash in Bank – perang nasa bank.
- NOTE: Back read ka Nak sa Part1. 
c. Petty Cash – maliit na value ng
Same lang din ang explanation ng No.1-10.
pera.
May mga dinagdag lang tayo for “clarity.”

2. ACCOUNTS RECEIVABLES 10. OFFICE/STORE SUPPLIES - are

- are claims (Mga Pautang) from a being “used by the business” like papers,
debtors or customers na umutang sa’yo. pens, pencils, folders, staplers, etc.

3. NOTES RECEIVABLE
- Pautang supported by promissory note. SUBSET: “NON-CURRENT ASSETS”
NOTE: Current Asset, if short-term.
Non-Current Asset, if long-term. 1. LAND (Lupain)
- is an asset that is not subject to
4. ACCRUED INCOME depreciation. It appreciates (Value
increases) as time goes by. (In-explain na 4. Unearned Income
din ‘to sa Part 1. Go and see for yourself.) 5. Current Portion of Long-Term Debt
- are portions of notes, bonds, mortgages
2. BUILDING and other long-term indebtedness which
- can be acquired by; are to be paid "WITHIN ONE YEAR"
a. PURCHASE or by means of, from the Balance Sheet date (or end of
b.CONSTRUCTION. Reporting Period).
- Construction costs may include;
a. Materials SUBSET: LONG-TERM LIABILITIES
b. Labor 6. Notes Payable
c. Overhead Expense 7. Bonds Payable
d. Permit or License 8. Mortgage Payable BACK-
e. Architect fee
READ.
**********************************
f. Excavation cost
ACCTNG. NAMES for “REVENUE / Y”
3. OFFICE EQUIPMENT SUBSET: SALES
- includes computers, machineries, air-
conditioning units, electric fans, 1. SALES INCOME
freezers, refrigerators, truck, etc. – summarize sale of goods of a trade or
merchandising business.
4. FURNITURE AND FIXTURES 2. INTEREST INCOME
- includes tables, chairs, cabinets, etc. - an earning collectibles in the future.
3. GAIN ON SALES of other ASSETS
5. ACCUMULATED DEPRECIATION - sales on disposed asset. (no longer used)
- mga asset na “Depreciated” ang value.
(Contra Asset) Ex. Gain on sales of Equipment, Land, etc.
Ex. Acc. Dep. (Bldg., M&E, F&F.)
SUBSET: SERVICE
6. INTANGIBLE ASSET
- is an identifiable non-monetary asset 1. SERVICE INCOME
"without physical substance" or have no - earning derived from service rendered
physical appearance but are expected to 2. PROFESSIONAL FEES
provide future economic benefits to the - rendered professional service.
company. Ex. Franchise, TM, Patent, 3. RENT INCOME SALES
Copyright. (Back Read ulit Nak sa Part 1.) - kita mula sa “pa-upa” / “pa-arkila.”
ACCTNG. NAMES for “LIABILITIES”
ACCTNG. NAMES for “O.E.”
SUBSET: SHORT-TERM LIABILITIES
1. Accounts Payable 1. OWNER’s CAPITAL (Puhunan)
2. Notes Payable Nasa Part 2 - Owner’s “Original Investments."
3. “Accrued Expenses lang din ang
or Utilities Expenses” explanation. 2. OWNER’s ADD’L INVESTMENT

BACK-READ.
- “Dagdag-puhunan.” - Isang Short-term Liability.
- Utang siya kasi may natanggap ng bayad
3. OWNER’s DRAWING / pero hindi pa nagrerender ng service.
TEMPORARY WITHRAWAL 2. ACCRUED INCOME
- Charged to this account are cash or - (Current Asset)
other assets WITHDRAWN by the owner - “Earned but not yet received.”
from the business FOR PERSONAL USE. Ito yung “kumita ka na”, pero “hindi pa
(Galing ito sa Owner's share in profit.) natatanggap” yung pera.
3.ACCRUED EXPENSE
4. PERMANENT WITHDRAWAL - a.k.a. Utilities Expense (Meralco)
- (Ex. Consumed Electricity)
- It means discarding / withdrawal ng
- (Short-term Liabilty)
No.1 & 2.(Owner’s Beginning Capital and
4. PREPAID EXPENSE
Owner’s Additional Investment.)
- (Current Asset)
**********************************
5. DEPRECIATION EXPENSE
ACCTNG. NAMES for “EXPENSES” - (Contra Asset)
SUBSET: COMMON EXP. - a.k.a. “Accumulated Depreciation”
- Pagliit ng halaga or "pagkaluma" dahil
1. SUPPLIES EXPENSE nagamit mo na ang "Office Building."
- the value of merchandise sold. 6. DOUBTFUL ACCOUNTS EXPENSE
2. SALARIES AND WAGES EXPENSES - (Contra Asset)
- amount paid to employees. - a.k.a. “Allowance for Doubtful Accounts”
3. INSURANCE EXPENSE 7. BAD DEBT EXPENSE
- Ex. Life Insurances. - (Contra Asset)
4. TAXES AND LICENSES EXPENSES - a.k.a. “Allowance for Bad Debts.”
- Ex. Business Tax, Tariff, National Tax.

NOTE: Ang Adjusting “Entries” ay “Pito

SUBSET: SERVICE
(7)” lamang sa mga “Accounting Entries.”
Nabanngit na rin naman na sa previous
1. DOUBTFUL ACCOUNT EXPENSES
lesson kaya lang, need nating mag-“adjust”
- debt or uncollectible account exp.
sa kanila. Most of Accounting Students ay
2. DEPRECIATION EXPENSE dito nalilito.
- represents the current periodic
cost for using depreciable PPE.

TIP:
ADJUSTING ENTRIES
Be mindful sa 7 “Adjusting Entries” na ito
dahil baka ma-determine sila sa maling
Adjusting Entries of a Service Business “Accounting Title” or “Nature”.
1. UNEARNED INCOME
- a.k.a. “Advances from Customers” - Hindi porket may “income” ay example na
- (Short-term L.) kaagad ng income dahil pwedeng Short-
term Liabilty yun o di kaya ay asset. - Owner’s Equity/Capital
Check mo.
Real accounts are reported in the
- Hindi rin porket may nakalagay na Statement of Financial Position
“expense” ay expense dahil pwedeng (or "BALANCE SHEET").
Current Asset, Contra Asset, or Short-
term Liability yun. Check mo ulit. These accounts are called permanent
because they are not "closed" at the end
- Again. Be mindful. of accounting period.
- Check mo kung isa ba sa 7 na “Adjusting
Entry” ang mae-encounter mo.  NOMINAL ACCOUNTS
Ex. (or TEMPORARY accounts)
- Revenues / Income
ASSETS - Expenses and
- Cash P360 - Owner’s Drawing
- Office Building P500
- Office Equipment P500 Nominal Accounts are those that
- Prepaid Expense P100 comprise the elements of the Statement
TOTAL ASSETS: of Financial Performance (or INCOME
(360+500+ 500+100+360) = P1,460 STATEMENT) – the revenue and
expenses accounts.
LIABILITY
- Unearned Income P360 These accounts are called temporary
because they are "closed" at the end of
OWNER'S EQUITY the accounting period.
- Owner’s Capital (Investments) P1,100
************************************* *Please note that Owner’s Drawing is
A = L + OE NOT an income statement account, but
P1,460 = P360 + P1,100 must also be closed, or put into zero
P1,460 = P1,460 balance, at the end of the accounting
period.
BALANCE! Am@zing!!!  REMINDER:
try to study Chapter1 (w/ Part 1&2) at
the same time.”
RECAPITULATION: (Recall muna..)
REAL ACCOUNTS and 1. Luca Pacioli – Father of Acctg.
NOMINAL ACCOUNTS 2. Forms of Bus.Org. (4)
[Sole Proprietor, Partnership, Corp, & Coop.]
3. Types of Bus. Org.(3)
REAL ACCOUNTS
[Service, Trading, & Mftg.]
(or PERMANENT accounts)
4. Statement Of Financial Position (Balance
- Assets Sheet) (3) [A = L + OE]
- Liabilities and [Assets, Liabilities, & Owner’s Equity]
5. Statement Of Financial Performance PAALALA: “APPLICATION NG Chapter2.”
(Income Statement) (3) [Gain = RoI - Exp] ~ WAG basahin kung hindi pa cleared
[Net Income, Revenue/Income(y) & Expense]
6. Fin’l Char. / Acctg. Titles
sa’yo ang Chapter1&2 dahil hindi mo lang
LEFT (D.E.A.L.) RIGHT (G.I.R.L.S.) maiintindihan. Mapu-frustrate ka lang.
- Drawings - Gains
- Expenses - Income (Y)
Take it one step at a time. (Except sa
- Assets - Revenue
- Losses - Liabilities, and Chapter3 na dapat basahin ang
- Stocks/Share (OE) Chapter1&2 ng sabay. May reason yun
7. Subsets of Assets; (2) kung bakit. Malalaman mo yun kung binasa
[Current A. & Non-Current A.]
mo na ang Chapter na ito. )
8. Subsets of Liabilities; (2)
[Short-term L. & Long-term L.]
9. Subsets ofOwner’s Equity (OE); (2) Ang module na ito is a form of “sequence.”
[Withrawal & Deposits] May pattern. Mas naiintindihan ang mga
10. Subsets of Revenue / Income; (2)
future topics pag nire-recap ang previous
[Sales of Goods & Services]
11. Subsets of Expenses; (2) lessons.
[Common Exp. & Estimated Exp.]
12. Acctg. Names for Current A. (10) Alam ko nakakalito pero may solusyon.
[Cash, AR, NR, A.Inc., AtE, Mer.Inv., Tr.Sec.,
The key is "REPETITION.” Nasabi ko to
AfDA, Pre-Exp., Off./Store S.]
12. Acctg. Names for Non-Current A. (6) sa Part 1.
[Land, Bldg, OE, F&F, Acc.Dep, Intangibles]
13. Acctg. Names for Short-term L. (5)
It takes time to Learn and Understand.
[AP, NP (short), Acc.Exp., Un.Inc., CPfLt]
Basahin lamang ng maraming beses. 
14. Acctg. Names for Short-term L. (3)
[NP (long), BP, & M.P.] You need Patience, Perseverance, Sipag,
15. Acctg. Names for O.E.(4) Tiyaga (at Dasal na rin.)
[OC, OAI, OD(TW) & PW]
16. Acctg. Names for Revenue/Income(Y)(6) TIP:
Sales [SI, II, GoS,] & Service [SI, PF, RIS]
"Don't MEMORIZE, INTERNALIZE."
17. Acctg. Names for Expenses (6)
Common[SE, S&WE, IE, T&LE,]&Est[DAE,DE]
18. Real Acc.[A,L,OE]& Nominal Acc.[I,E,OD] Ready ka na ba Nak?
Game na?
Chapter 3 Then lets begin…
DEBIT –
[D.E.A.L.]
DEBIT & a.k.a.
“left”
D - rawings
CREDIT - ito yung

E - xpenses

A - ssets

L- osses (No Need)

 tumutukoy sa D.E.A.L. Ex.
A.Payable / Short-term / Liability = Credit.
Owner’s Additional Investment / OE = Credit.
Prof. Fee/ Service / Revenue -Income =Credit
Apply "Friends" & "Enemies" of OE

Who are the "Friends" of OE?

- “Revenue, Income, Gain”
- Nature: Credit

- Kapag nag-“increase” ang amount ng Who are the "Enemies" of OE?

any type of Asset, Expense, even - “Expense, Owner’s Drawings”
Owner’s Drawing (Temporary - Nature: Debit
Withrawal), that’s Debit.
Ex. Hence,
when Revenue increases, Credit.
DEBIT CREDIT DEBIT CREDIT
D.E.A.L. G.I.R.L.S D.E.A.L. G.I.R.L.S
When INCREASES When DECREASES
A.Receivable / Current / Asset = Debit.
A. for Doubtful Acc. / Contra A. = Credit when Income increases, Credit.
Insurance Exp. / Common / Exp. = Debit. But…
when Expense increases, Debit.
CREDIT – a.k.a. “right [G.I.R.L.S.]
when Drawing increases, Debit.
- ito yung tumutukoy sa G.I.R.L.S
G – ains (No Need) NOTE:
Napansin
mo I - ncome ba na
everytime
nag- R - evenue
i-“I NCREASE”
o L - iabilities

S- tocks / Shares
(Owner’s Equity)

“nagkaroon” ng isang entry, napupunta sya

sa tamang Nature nito?
Ex. If increases…(or nagkaroon)
- Kapag nag-“increase” ang amount ng any type A.Receivable / Current / Asset = Debit.
of G.I.R.L.S., that’s Credit. A. for Doubtful Acc. / Contra A. = Credit.
Insurance Exp. / Common / Exp. = Debit.
A.Payable / Short-term / Liability = Credit. Nakakasabay? If not, Ulit-ulitin mo lang to…
Owner’s Additional Investment / OE = Credit.
Prof. Fee/ Service / Revenue -Income=Credit Hindi pwede sa Accounting ang hula-hula.

Pag D.E.A.L. = Nature: Debit Wika nga sa kasabihan ng mga Acctg.

Pag G.I.R.L.S. =Nature: Credit
Students, “NEVER ASSUME, UNLESS
OTHERWISE STATED.”
Nakasabay? 

Wag mag-a-assume. Dapat ALAM.

Q. Papano naman kung mag-“DECREASE”?
Dahil LAMANG ang may ALAM!
Debit pa din ba ang nature ng D.E.A.L.? BUSINESS’ POINT OF VIEW
Credit pa din ba nature ng G.I.R.L.S.?
ASSETS
ANS. Not anymore.
This time, it will become "OPPOSITE."
Increase in Asset
Ex. If decreases… (or nawalan) Nagkakaroon ng asset ang business
A.Receivable / Current / Asset = Credit.
kasi pwedeng
A. for Doubtful Acc. / Contra A. = Debit.
Insurance Exp. / Common / Exp. = Credit. -nanggaling sa inutang niya (ito ang
A.Payable / Short-term / Liability = Debit. pautang or investment ng creditors)
Owner’s Additional Investment / OE = Debit. -nanggaling sa owner (ito ang initial or
Prof. Fee/ Service/ Revenue -Income= Debit additional investment ng owner)
-galing sa serbisyo/benta
D.E.A.L.= Nature: Credit (when decreases)
G.I.R.L.S. =Nature: Debit (when decreases)
Decrease in Asset
Nakasabay?  Nawawalan naman ng asset ang
WAG MALILITO NAK HA. business kasi pwedeng
-nagbayad siya ng utang
Kapag ang amount ng isang D.E.A.L. or
-ibinalik na yung capital sa owner
G.I.R.L.S. ay nag-INCREASE, NORMAL
BALANCE ang tawag. Ibig sabihin, yung (withdrawal by the owner)
“normal na nature ang aggamitin.” -may mga gastusin o expenses
Debit pag D.E.A.L. at Credit pag G.I.R.L.S.

Kapag ang amount ng isang D.E.A.L. or NORMAL BALANCES:

G.I.R.L.S. ay nag-DECREASE, OPPOSITE (When Increases or pag “nagklaroon”)
BALANCE ang tawag. Ibig sabihin, yung
“opposite na nature ang aggamitin.” DEBIT (D.E.A.L.)
Debit pag G.I.R.L.S. at Credit pag D.E.A.L. D-rawings
E-xpenses
A-ssets R-evenues
L-osses L-iabilities
S-tockholder's (or Owner's) Equity
CREDIT (G.I.R.L.S.) CREDIT (D.E.A.L.)
G-ains D-rawings
I-ncome E-xpenses
R-evenues A-ssets
L-iabilities L-osses
S-tockholder's (or Owner's) Equity
"DEBIT AND CREDIT"

1. Bumili ka ng Laptop at nagbayad ka

EQUITY/CAPITAL = Investment +
ng P50, 000
Revenue - Expenses – Drawings
DEBIT: Laptop 50,000
Increase in Equity CREDIT: Cash 50,000
-Tumataas ang Equity pag mas malaki “Nagkaroon ka” ng Laptop, kaya DEBIT
ang kita(revenue) kaysa sa “Nawalan ka” naman ng Cash kaya CREDIT
gastos(expenses). Ang tawag dito ay NOTE: (ASSET)
"Net Income". Pag "nagkakaroon" ka ng Asset(or bagay)
-Pwede rin tumaas ang Equity pag = DEBIT
nadadagdagan ang capital(pera o Pag "nawawalan" ka ng Asset (or bagay)
gamit) ng business. = CREDIT
**********************************
Decrease in Equity
-Bumababa ang Equity pag mas malaki 2. Bumili ka ng Laptop pero utang,
ang gastos(expenses) kaysa sa revenue P50,000
or kita. Ang tawag dito ay "Net Loss". DEBIT: Laptop 50,000
-Pwede rin bumaba ang Equity pag CREDIT: A.Payable 50,000
ibinalik na ang capital(pera o gamit) sa “Nagkaroon ka” ng Laptop, kaya DEBIT
may-ari. (Withdrawal by the owner) “Nagkaroon ka” ng utang (A.P), CREDIT
NOTE: (LIABILITY or UTANG)
Pag "nagkakaroon" ka ng utang = CREDIT
OPPOSITE BALANCES: Pag "nawawalan" ka ng utang = DEBIT
(When amount decrease or pag “nawalan”)
REMINDER:
DEBIT (G.I.R.L.S.) “Baliktad ang ASSET at LIABILITY!”
G-ains
I-ncome (ASSET)
 DEBIT: pag "nagkakaroon" ka. 5. Nakolekta mo na yung pautang mo
CREDIT: pag "nawawalan" ka. sa tinuruan mong estudyante P20,000.
DEBIT: Cash 20,000
(LIABILITY) CREDIT: A. R. 20,000
DEBIT:pag "nawawalan" ka ng utang.
CREDIT: pag "nagkakaroon" ka ng utang. “Nagkaroon ka” ng Cash, kaya DEBIT.
********************************** “Nawalan ka” ng pautang or
(Accounts Receivable), kaya CREDIT.
*******************************
............................................
HERE’S AN EXAMPLE. ACCOUNTING
ASSESS YOURSELF! TUTORIAL - PART 6.1

3. Binayaran mo na ang utang.

JOURNALIZIN
DEBIT:
CREDIT:
Accounts Payable 50,000
Cash 50,000
G
“Nawala na” ang utang (A.P.),
kaya DEBIT.
1. An owner "opened an account" with BDO
Nawalan ka din ng Cash, kaya CREDIT.
and deposited P850,000 CASH. He also
*Yehey, wala nang utang. "invested" two personal COMPUTERS which
he acquired a year ago for P20,000 each but
********************************** w/ a fair market value of P15,000 each.
4. Ginamit mo yung Laptop sa business DEBIT: Cash P850,000
mong Accounting Tutorial. Kumita ka Office Equipment (P30,000 (P15k x 2)
ng P20,000 pero "pautang". CREDIT: Owner’s Capital P880,000

DEBIT: A.Receivable 20,000

(P850k +P30k)
CREDIT: S. Income 20,000 **********************************
Nagkaroon ka ng "pautang" or (A.R.) 2. PAID local “TAXES”, P3,900.
(Asset siya kasi makokolekta mo siya), Dr: Taxes & Licenses Exp. P3,900
kaya DEBIT Cr: Cash P3,900
Nagkaroon ka din ng kita o income or **********************************
(Prof. Fee), kaya CREDIT. 3. Bought a small Office Bldg. for P500,000.
(giving P250,000 CASH for Mortgage Payable.
NOTE: (INCOME or KITA) Dr: Office Building P500,000
Pag "nagkakaroon" ka ng Cr: Cash P250,000
Service income = CREDIT Mortgage Payable P250,000
********************************** (P500k - P250k)
**********************************
4. Owed office Tables & Chairs, P40,000. Dr: Prepaid Rent P30,000
Dr: Furniture and Fixtures P40,000 Cr: Cash P30,000
Cr: Accounts PayableP40,000 **********************************
********************************** 12. Paid "1yr. Insurance" of the Office
5. BILLED a client for Service, P20,000. Bldg., P25,000.
Dr: Accounts Receivable P20,000 Dr: Prepaid Insurance P25,000
Cr: Service Income P20,000 Cr: Cash P25,000
********************************** **********************************
6. Purchases Office Supplies via Cash. P4,500 13. Paid P4,250 for employee’s salary
Dr: Office Supplies P4,500 Dr: Salaries Expense P4,250
Cr: Cash P4,500 Cr: Cash P4,250
ACCOUNTING
TUTORIAL - PART 6.2

T-ACCOUNTS
- is an informal term for a set of financial
7. PAID 50% of the amount OWED. (See #3) records that uses “double entry”
Dr: A.Payable P20,000 (P40,000 x 50%) bookkeeping. The symbol looks like a
Cr: Cash P20,000 letter “T”.
**********************************
8. Francis withdrew cash of P50,000 & Office
Supplies worth P1,000 for “personal use.” Debit Entry (Dr) Credit Entry (Cr)
Dr: Owner’s Drawing P51,000 (P50k + P1k)
Cr: Cash P50,000
Office Supplies P1,000
**********************************
9. Received P5,000 as payment for the
Services rendered to one of their clients.
- Nire-record nito ang amount ng isang
entry na pwedeng may amount sa Debit or
Dr: Cash P5,000
pwedeng may amount sa Credit.
Cr: Service Income P5,000
********************************** Ex. Connect lang natin ung problem kanina
10. Collected “one half” (½) of the amount sa Journalizing na meron ng amount for
due from client on #5. (See #5) Debit & Credit in questions #1 to #13.
Dr: Cash P10,000
Cr: Acc.Rec. P10,000 (P20,000 x ½) Now, this is an example of a
********************************** T-ACCOUNTS.
11. Paid "1yr. Rent" for a special machine to
be used in business operations, P30,000. CASH – P477,350
#1 P850,000 #2 P3,900 #7 P20,000 #4 P40,000

#9 P5,000 #3 P250,000 ACCOUNTS RECEIVABLE(A.R.)P30,000

#10 P10,000 #6 P4,500 #5 P20,000

#10 P10,000
#7 P20,000
SERVICE INCOME P25,000
#8 P50,000
#5 P20,000
#11 P30,000
#9 P5,000
#12 P25,000
OFFICE SUPPLIES P3,500
#13 P4,250
#6 P4,500 #8 P1,000
OFFICE EQUIPMENT (Computers)
PREPAID RENT
#1 P30,000
#11 P30,000

PREPAID INSURANCE

#12 P25,000

SALARIES EXPENSE

#13 P4,250

OWNER’s CAPITAL

#1 P880,000

TAXES & LICENSES EXPENSE (TLE)

#2 P3,900

OFFICE BUILDING

#3 P500,000

MORTGAGE PAYABLE (M.P.)

#3 P250,000

FURNITURE AND FIXTURES (F&F)

#3 P250,000

ACCOUNTS PAYABLE (A.P.) – P20,000

NOTE: [ Credit – Debit ]
Look at the CASH entries. P40,000 – P20,000 = P20,000
As you can see, may mga amount ang Cash SUMMARY:
both in Debit and Credit. To get its Total Kung susumahin lahat ng entries from
Balance, All debit amounts of Cash will be Questions #1-13 na nai-“Journal” at nai- “T-
minus or subtracted by all credit amounts. Accounts” na, The table below shows the
In equation, Accounting Entries w/ amounts based on its
[ Debit – Credit ]
Ex. ACCTG. ENTRIES Dr Cr
CASH – P477,350

#1 P850,000 #2 P3,900 Cash P477,350

#9 P5,000 #3 P250,000 Accounts Receivable P10,000

#10 P10,000 #6 P4,500 Prepaid Rent P30,000

#7 P20,000 Prepaid Insurance P25,000

#8 P50,000 Office Supplies P3,500

#11 P30,000 Office Building P500,000
#12 P25,000
Office Equipment P30,000
#13 P4,250
Furniture & Fixture P40,000

Q. Saan galing ang Cash worth P477,350? Accounts Payable P20,000

ANS. Galing ito sa Total amount ng Debit
Mortgage Payable P250,000
Cash “minus” Total amount of Credit Cash.
[ Debit – Credit ] Owner’s Capital P880,000
P 865,000 – P 387,650 = P477,350
NOTE: Owner’s Drawing P51,000
Pag mga D.E.A.L.Entries,
Debit minus Credit. Service Income P25,000
Ex. Yung sa Cash.
Salaries&Wages Exp. P4,250
Pag mga G.I.R.L.S.Entries,
Taxes& Licenses Exp. P3,900
Credit minus Debit.
Ex. Look at Accounts Payable or A.P. TRIAL BALANCE 1,175,000 1,175,000
ACCOUNTS PAYABLE (A.P.) – P20,000 nature. (Debit-Credit) Go see for yourself and
relate how it is done. 
#7 P20,000 #4 P40,000
NOTE:
A.P. is a form of Liability kaya under sya ng FINANCIAL STATEMENT ang tawag sa
G.I.R.L.S. Hence, [Credit–Debit] ang
isang table kapag “Real Accounts” lang
format.
ang Acctg. Entries. (“Assets, Liabilities,
In equation,
& Owner’s Equity” Entries only…) C.Trial Balance
INCOME STATEMENT kapag “Nominal - both Financial & Income Statement.
Accounts” (“Revenue /Income, Expenses F.S. I.S. T.B.
& Owner’s Drawing” Entries only…) Assets Rev/Income Both F.S. &
TRIAL BALANCE both Real & Nominal. Liabilities Expenses I.S. Acctg.
{[A+ (Exp+OD)] = (L+OE) + (Rev/Inc)} OE (Capital) OD (Drawing) Entries

ACCOUNTING
TUTORIAL - PART 6.3 - Ex. Look under the table w/ a balancing
amount of P1,175,000
- CLOSING ENTRIES -

BALANCING ACCTG. ENTRIES Dr Cr

(CLOSING ENTRIES) ASSETS

CURRENT ASSETS:
Accounts Receivable P10,000
BALANCING (Closing Entries) Cash P477,350
- Tha “last applying stage” in Office Supplies P3,500
Basic Accounting. Prepaid Insurance P25,000
- a.k.a. “Closing Entries” dahil dito Prepaid Rent P30,000
nagtatapos ang “application” ng TOTAL CURRENT A. P545,850
Basic accounting. FIXED ASSETS:
Furniture & Fixtures P40,000
Q. Saan ba tayo nagsimula patunkgol sa Office Building P500,000
application ng Basic Accounting? Office Equipment P30,000
ANS. Sa Part 5.Debit and Credit. TOTAL FIXED A. P570,000
Then nag-proceed na tayo sa: TOTAL ASSETS: 1,184,350
1. Journalizing (Adjusting Entry) LIABILITIES
2. T-Accounts at ngayon sa, SHORT-TERM L.
3. Balancing
Accounts Payable P20,000
NOTE: Sa pagba-Balancing, may Iba’t TOTAL SHORT-T. L. P20,000
ibang Format ito na dapat ay aware ka:
LONG-TERM L.
A. FinancialStatement
Mortgage Payable P250,000
B. Income Statement
TOTAL LONG-T. L. P250,000
C. Trial Balance
TOTALLIABILITIES P270,000
Na-explain na to. Backread na lang. 
On the other hand,
OWNER’s EQUITY
A. FinancialStatement (or Balance Sheet) Owner’s Capital P880,000
- is a Statement of “Financial Position” Owner’s Drawing (P51,000)
B.Income Statement TOTAL OE (Capital) (P51,000) P880,000
- Statement of “Financial Performance” REVENUE/INCOME
Service Income P25,000
TOTAL REV/INC. P25,000 Long-term L.
EXPENSES 2. OE (Capital)
Salaries & Wages Exp. 3. Revenue / Y
P4,250
4. Contra Assets
Taxes & Licenses Exp. P3,900 NOTE:
TOTAL EXPENSES Add the “amount” ofDebit Entries,
P8,150
as same with Credit Entries. If the
TRIAL BALANCE 1,175,000 1,175,000
amount of Dr & Cr “equals,” then…
RECAPITULATION: it’s BALANCE! 
ACCOUNTING RELATIONS
JOURNALIZING
1. CPA Board Exams
1. ASSETS
2. Career Fields in Accounting
Nagkaroon (+) = DEBIT 3. Different Accounting Areas
Nawalan (-) = CREDIT 4. Different Regulatory Bodies
2. LIABILITIES 1. CPA Board Exams
Q: SINO ang allowed mag-take ng Phil. CPA Board Exam?
Nagkaroon (+) = CREDIT A:- Yung mga graduate sa course na BSA
Nawalan (-) = DEBIT - Yung may GOOD MORAL CHARACTER
3. OWNER'S EQUITY - Yung hindi napatunayang guilty ng "MORALTURPITUDE"

Nagkaroon (+) = CREDIT (like Adultery or Concubinage - pakikiapid)

Nawalan (-) = DEBIT - Filipino citizen.
Q: Tuwing KAILAN ginaganap ang CPA Board Exam?
4. REVENUE OR INCOME
A: Dalawang beses sa isang taon. May and October.
Nagkaroon (+) = CREDIT Q: Ilan at Ano ang mga SUBJECTS sa CPA board exam ?
Nawalan (-) = DEBIT A: 6 subjects
- RFBT (Regulatory Framework for Bus. Transactions)
5. EXPENSES - TAX (Taxation)
Nagkaroon (+) = DEBIT - MAS (Management Advisory Services)
Nawalan (-) = CREDIT - AUDITING (Auditing theory and Auditing problems)
- FAR (Financial Accounting and Reporting)
T-ACCCOUNTS - AFAR (Advanced Financial Accounting and Reporting)
is a “double entry” bookkeeping. Q: Paano makapasa sa CPA board exam?
A: General weighted average of 75% and above
The symbol looks like a letter “T”.
(with no grades below 65% in any subject)
BALANCING Q: Anong mangyayari pag ang Gen. Ave. ay above 75%,
it balances the amount of Dr & Cr. ngunit may grade na below 65% sa ibang subject(s)
A: CONDITIONAL if 75% and above ang at least 4
DEBIT: subjects
1. Assets -FAILED if 3 subjects and below lamang ang 75% & Up.
*Masasabing CONDITIONAL ang status kapag 75% and
Current A. above ang grade niya sa at least 4 subjects (kahit na
Non-Current A. / ZERO pa ang grade sa natitirang 2 subjects).
*Ang CONDITIONAL examinee ay kailangang mag-exam
Fixed A.)
ulit para kunin ang di naipasang subject(s) within 2 years
2. Expenses mula sa exam kung saan siya na-conditional.
3. Drawings (Withrawals) 2. Career Fields in Accounting
A. Public Accounting
CREDIT: B. Commerce and Industry / Private Accounting
1. Liabilities C. Academe (Education)
Short-term L. D. Government Accounting
3. Different Accounting Areas
A. Basic Accounting / Bookkeeping
B. Financial Accounting
C. Managerial Accounting
D. Auditing
E. Cost Accounting
F. Government Accounting
4. Different Regulatory Bodies
A. PRC (professional Regulation Commission)
B. PRBOA (Professional Regulatory Board of Accountancy)
C. PICPA (Philippine Institute of Certified Public
Accountants)
D. FRSC (Financial Reporting Standards Council)
E. IASB (International Accounting Standards Board