Prepare Journal Entries
Transaction #1: On December 1, 2021, Mr. Donald Gray started Gray Electronic
Repair Services by investing P10,000.
Transaction #2: On December 5, Gray Electronic Repair Services paid
registration and licensing fees for the business, P370.
Transaction #3: On December 6, the company acquired tables, chairs, shelves,
and other fixtures for a total of P3,000. The entire amount was paid in cash.
Transaction #4: On December 7, the company acquired service equipment for
P16,000. The company paid a 50% down payment and the balance will be paid
after 60 days.
Transaction #5: Also on December 7, Gray Electronic Repair Services
purchased service supplies on account amounting to P1,500.
Transaction #6: On December 9, the company received P1,900 for services
rendered.
Transaction #7: On December 12, the company rendered services on account,
P4,250.00. As per agreement with the customer, the amount is to be collected
after 10 days.
Transaction #8: On December 14, Mr. Gray invested an additional P3,200.00
into the business.
Transaction #9: Rendered services to a big corporation on December 15. As per
agreement, the 3,400-amount due will be collected after 30 days.
Transaction #10: On December 22, the company collected from the customer in
transaction #7.
Transaction #11: On December 23, the company paid some of its liability in
transaction #5 by issuing a check. The company paid $500 of the $1,500
payable.
Chart of Accounts
SSETS (1000-1999)
1000 Cash
1010 Accounts Receivable
1011 Allowance for Doubtful Accounts
1020 Notes Receivable
1030 Interest Receivable
1040 Service Supplies
1510 Leasehold Improvements
1520 Furniture and Fixtures
1521 Accumulated Depreciation – Furniture and Fixtures
1530 Service Equipment
1531 Accumulated Depreciation – Service Equipment
LIABILITIES (2000-2999)
2000 Accounts Payable
2010 Notes Payable
2020 Salaries Payable
2030 Rent Payable
2040 Interest Payable
2050 Unearned Revenue
2060 Loans Payable
OWNER'S EQUITY (3000-3999)
3000 Mr. Gray, Capital
3010 Mr. Gray, Drawing
REVENUES (4000-4999)
4000 Service Revenue
4010 Interest Income
4020 Gain on Sale of Equipment
4999 Income Summary
EXPENSES (5000-5999)
5000 Rent Expense
5010 Salaries Expense
5020 Supplies Expense
5030 Utilities Expense
5040 Interest Expense
5050 Taxes and Licenses
5060 Depreciation Expense
5070 Doubtful Accounts Expense
Journal Entries
1) Cash 10,000
Gray, Capital 10,000
To record cash invested by Mr. Donald Gray
2) Expenses 370
Cash 370
To record payment of cash for registration and licensing fees
3) Furniture & Fixtures 3,000
Cash 3,000
To purchase of furniture & fixtures for cash
4) Equipment 16,000
Cash 8,000
Accounts Payable 8,000
To record purchase of equipment on account with 50% down payment made in
cash, balance will be paid after 60 days
5) Supplies 1,500
Accounts Payable 1,500
To record purcahse of supplies on account
6) Cash 1,900
Service Revenue 1,900
To record cash received for service rendered
7) Accounts Receivable 4,250
Service Revenue 4,250
To record service record on account with terms n/10
8) Cash 3,200
Gray, Capital 3,200
To record additional investment
9) Accounts Receivable 3,400
Service Revenue 3,400
To record service record on account with terms n/30
10) Cash 4,250
Accounts Receivable 4,250
To record collection of service on account with terms n/10
11) Accounts Payable 500
Cash 500
To record partial payment of supplies purchased on account
