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Ginalyn Reyes Activity 10 - Recording Credit

Divine owns a lechon manok business. In February, she had various cash and credit transactions including buying supplies, selling lechon, and paying expenses. She needs a credit record book to track items bought and sold on credit separately from cash transactions. Her cash record book and cash flow statement only include cash items to properly track her cash position.

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kenneth reyes
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581 views3 pages

Ginalyn Reyes Activity 10 - Recording Credit

Divine owns a lechon manok business. In February, she had various cash and credit transactions including buying supplies, selling lechon, and paying expenses. She needs a credit record book to track items bought and sold on credit separately from cash transactions. Her cash record book and cash flow statement only include cash items to properly track her cash position.

Uploaded by

kenneth reyes
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Ginalyn Reyes

Activity 10 – Recording Credit

So far, all our lessons are based on Cash activities. Let’s now study how to handle credit.

Divine’s Lechon Manok


Divine has a Lechon Manok business. The following are her activities for the month of
February:

Date Description Amount


Feb.1 Beginning Balance 15,000.00
Feb. 3 Bought Charcoal 550.00
Bought ingredients for chicken sauce 725.00
Feb. 5 Bought dressed chicken 1,000.00
Feb. 8 Sold 7 Lechon Manok @ P150 1,050.00
Feb. 11 Paid wages of Lechonero 500.00
Feb. 12 Got Charcoal on credit 750.00
Sold 5 Lechon Manok @ P150 750.00
Feb. 15 Paid Electricity bill 325.00
Sold 5 Lechon Manok @ P150 750.00
Feb. 17 Paid Charcoal obtained on credit 750.00
Bought dressed chicken 1,500.00
Feb. 21 Paid rent 800.00
Feb. 22 Paid installment for motorcycle (for delivery) 5,000.00
Feb. 25 Sold 20 Lechon Manok @ P150 3,000.00
Feb. 26 Sold 5 Lechon Manok @ P150 on credit to Mrs. Cruz 750.00
Feb. 28 Bought Charcoal in cash 750.00
Paid wages of Lechonero 500.00
Paid for tuition fees of son 2,000.00
Feb. 28 Mrs. Cruz pays for Lechon Manok that she owes 750.00

Notice that she has credit activities. She buys some supplies and sells her product on
credit. This will affect her record-keeping. She needs a Credit Record Book aside from
a Cash Record Book.

She has to separate her cash from her credit transactions. She uses a simple notebook as
her Credit Record Book. Complete her recording below based on her activities listed
above:

PAUTANG
sa UTANG sa
Paid
Date Sold Items Customer Amount Paid IN Bought Items Supplier Amount OUT
12-Feb Charcoal Mang Toto 750.00
17-Feb Mang Toto 750.00
26-Feb 5 Lechon Manok Mrs.Cruz 750
28-Feb Mrs.Cruz 750

Use the forms in the next pages to make Divine’s Cash Record Book and Cash Flow.
Remember, record only the cash activities in the Cash Record Book and in the Cash
Flow!
Ginalyn Reyes
Divine’s Cash Record Book
Date Cash In Cash Out Running
Balance
1 2a 2b 3a 3b 4

Item Amount Item Amount

Feb 2 Beginning Balance 15,000

feb3 Bought Charcoal 550

ingredients for chicken 725 13725


sauce
feb5 dressed chicken 1000 12725

feb8 Sold 7 Lechon Manok @ 1050 13775


P150
feb11 Paid wages of Lechonero 500 13275

feb12 Sold 5 Lechon Manok @ 750 14025


P150
feb15 Sold 5 Lechon Manok @ 750 Paid Electricity bill 325 14450
P150
feb17 Bought dressed chicken 1500 12950

feb21 Paid rent 800 12150

feb22 Paid installment for 5000 7150


motorcycle (for delivery)
feb25 Sold 20 Lechon Manok @ 3000 10150
P150
feb28 Bought Charcoal in cash 750 9400

Paid wages of Lechonero 500 8900

Paid for tuition fees of son 2000 6900


Divine’s Cash Flow
Date/Month
Cash at the
beginning of the
Period

CASH IN
Sales – Product
_______________

Any other cash in

TOTAL CASH IN

CASH OUT

Direct Materials -

Direct Labor -

Indirect Costs -

Any other cash out


(Loan Repayment,
Eqpt.)

TOTAL CASH OUT


Cash at the end of
the day
Cash Out for Family
Wages
Remaining Cash
After Family Wages

Discussion: Do you think Divine’s business is doing well? Why or why not?

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