The document discusses fundamentals of accountancy, business, and management. It covers topics such as defining accounting, describing the nature of accounting, narrating the history and origin of accounting, explaining accounting concepts and principles, illustrating the accounting equation, and analyzing business transactions.
The document appears to be a learning activity sheet or textbook for a grade 11 course on fundamentals of accountancy, business, and management.
The major topics covered include defining accounting, describing the nature of accounting, narrating the history and origin of accounting, explaining accounting concepts and principles, illustrating the accounting equation, discussing the major accounts, preparing a chart of accounts, illustrating journal and ledger formats, and analyzing business transactions.
11
FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 First Quarter
LEARNING ACTIVITY SHEETS
i COPYRIGHT PAGE
Learning Activity Sheet in Fundamentals of Accountancy,
Business and Management Grade 11
Copyright @ 2020
DEPARTMENT OF EDUCATION Regional Office No. 02 (Cagayan Valley) Regional Government Center, Carig Sur, Tuguegarao City, 3500
“No copy of this materials shall subsist in any work of the Government of the Philippines. However, prior approval of the government agency or office wherein the work is created shall be necessary for exploitation of such work for profit.”
This material has been developed for the implementation of the K to 12 Curriculum through the Curriculum and Learning Management Division (CLMD). It can be reproduced for educational purposes and the source must be acknowledged. Derivatives of the work including creating an edited version, an enhancement of supplementary work are permitted provided all original works are acknowledged and the copyright is attributed. No work may be derived from the material for commercial purposes and profit.
Consultants: Regional Director ESTELA L. CARIŇO, EdD, CESO IV Assistant Regional Director RHODA T. RAZON, EdD, CESO V Schools Division Superintendent MADELYN L. MACALLING, PhD, CESO VI Assist. Schools Division Supt. EDNA P. ABUAN, PhD DANTE J. MARCEL, PhD, CESO VI Chief Educ. Supervisor, CLMD OCTAVIO V. CABASAG, PhD Chief Education Supervisor, CID RODRIGO V. PASCUA, EdD
Development Team Writers : Richel A. Culam, Marcris T. Domingo,Brain Win L.Garcia, Fay P. Managuelod,Cyril M. Pacunana, and Carolyn M. Ramones Content Editors : Inocencio T. Balag,EPS Math, SDO Isabela Cyril M. Pacunana, Claudine Sevilleja, Mary Mendoza
Focal Persons : Inocencio T. Balag, Division EPS- Mathematics, Isabela
Ma. Cristina Acosta, Division EPS-LR Isagani R. Duruin, PhD., Regional EPS- Mathematics Rizalino G. Caronan, Regional EPS- LRMDS
Printed by DepEd Regional Office No. 02
Regional Center, Carig Sur, Tuguegarao City
ii TABLE OF CONTENTS
Competency Page No.
Define Accounting 1
The Learner Describe the Nature of Accounting 7
The Learner Narrate the History/Origin of Accounting 11
Define External Users and Gives Examples
Define Internal Users and Give Examples 16 Explain the Varied Accounting Concepts and Principles Solve Exercises on Accounting Principles as Applied in Various Cases 23 The Learners shall be Able to Illustrate the Accounting Equation Perform Operations Involving Simple Cases with the use of the Accounting Equation 28 Discuss the 5 Major Accounts 35 Prepare A Chart of Account 42 Illustrate the Format of a General and Special Journals 51 Illustrate the Format of a General and Subsidiary Ledger 59 Analyze Common Business Transactions Using the Rules of Debit And Credit 66 Solve Simple Problems and Exercises in the Analysis of Business Transactions 74 Describes the Nature of Transactions in A Service Business 86 Record Transactions of Service Business in the General Journal 92 Posts Transactions in the Ledger 118 Prepares a Trial Balance 146
iii FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Definition of Accounting Background Information for Learners:
Accounting is the process of IDENTIFYING, RECORDING AND COMMUNICATING
economic events of an organization to interested users. This involves selecting economic events that are relevant to a particular business transaction. The economic events of an organization are referred to transactions.
Learning Competency with code:
Define accounting. (ABM_FABM11-IIIa-1)
Activity I
Directions: Give five examples of economic events in a bakeshop business.
II. Multiple Choice: Choose the correct answer from the options given below. Circle the letter of the best answer.
1. Which of the following is NOT a relevant economic event?
A. Elijah, a manager of Northwing Corporation, who sold an abandoned building of his company. B. A customer service customer representative attended to the concern of complaining client C. Francis Company borrowed P5M from a bank due to a tight financial condition.
1 D. Angel Company gave its employees their salaries for the month of May
2. Which of the following statements describes the accounting process?
A. Recording economic events is an essential part of the accounting process. B. It involves identifying relevant economic events. C. The accounting process is not complete if the financial information is not communicated to interested users. D. All of the above
3. Which is the most important step in the accounting process?
A. Identification B. Communication C. Recording D. All steps are equally important
4. Which of the following is not a step in the accounting process?
A. Identification B. Recording C. Communication D. Verification
5. Rose, the chief accountant of Northwing Corporation, is preparing for a meeting with the top management. This meeting is done monthly to evaluate the performance of the company. Which step of the accounting process is most likely being done? A. Recording B. Communication C. Identification D. Classification
Activity III
Directions: Explain the three process of accounting using the three highlighted words in the graphic:
COMMUNICATING 3 ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ___________________________________ Activity IV Give two types of business from different industry (e.g. Shell, Puregold). In each business, give four examples of economic events. Discuss why these economic events or transaction are important. ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ___________________________________
Activity V Directions: Answer what is being ask. 1. Do your parents ask how you spend your allowance? ___________________________________________________________________ 2. When deciding between buying a soft drinks or fruit juices, what is the basis of your decision? Do you consider the prices of these commodities before you decide? ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _______________________ 3. Do you consider walking from school rather than riding tricycle sometimes because you want to save money? ___________________________________________________________________ 4. Relate your answers above to accounting. ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________
Guide Questions: 1. What are relevant economic events in an organization? 2. How do you identify relevant economic events in an organization? 3. After identifying the relevant economic events in an organization, how do accountants or bookkeepers record the transactions? Rubrics for Scoring Points 10 There is a clear, well focused idea that stands out and supported by detailed information 8 Main idea is clear but supporting information is general 6 Main idea is somewhat clear, but there is a need for more supporting information 4 The main idea is not clear. There is a seemingly random collection of information
Reflection:
Answer briefly. 1. What do you think you have learned from this activity? ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _______________________ 2. What did you like most about this activity and why? ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _______________________
References 1. Fundamentals of Accountancy, Business, and Management by: Joselito Florendo 2. https://drive.google.com/file/d/0B869YF0KEHr7dW04Xzd3UWRNZW8/view Answer Key: Activity I 1. Sales of bakeshop products 2. Purchase of raw materials that will be used in baking (e.g. flour, eggs) 3. Salaries of baker
5 4. Business permits 5. Purchase of equipment for baking Activity II 1. B 2. D 3. D 4. D 5. B Activity IV-VI -- Answers may vary
6 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Nature of Accounting
Background Information for Learners:
The five basic features of accounting are: 1. Accounting is a process. 2. Accounting is an art. 3. Accounting is an information system. 4. Accounting is a service activity. 5. Accounting is a means not an end.
Learning Competency with code:
The learner describes the nature of accounting. (ABM_FABM11-IIIa-2)
Procedure
Activity I Directions: Identify which feature of accounting being described. Write the letter of the correct answer before each number
A. Accounting is a process D. Accounting is an information system
B. Accounting is an art E. Accounting is a means not an end C. Accounting is a service activity
_____1. Accounting provides assistance to decision makers by providing them financial reports that will guide them in coming up with sound decisions. _____2. A process that refers to the method of performing any specific job step by step according to the objectives or targets. _____3. It is behavioural knowledge involving a certain creativity and skill that help us attain some specific objectives. _____4. It is recognized and characterized as a storehouse of information. _____5. It is a tool to achieve a specific objective.
7 Activity II Directions: Give one specific example of each feature of accounting that is applied in daily operations of business. Write your answer on the space provided. 1. Accounting is a process. ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _______________________ 2. Accounting is an art. ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _______________________ 3. Accounting is an information system. ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _______________________ 4. Accounting is a service activity. ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _______________________ 5. Accounting is a means not an end. ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ __________________________________ ___________________________________________________________________
Activity III Direction: Describe the images in relation to nature of accounting. Write your brief description in the box provided
8 Guide Questions: 1. What is the nature of accounting? 2. Why is it important to understand the feature of accounting? 3. How do you differentiate the features of accounting?
9 Rubrics for Scoring Points 10 There is one clear, well-focused idea that stands out and supported by detailed information 8 Main idea is clear but supporting information is general 6 Main idea is somewhat clear, but there is a need for more supporting information 4 The main idea is not clear. There is a seemingly random collection of information
Reflection: Write your brief description of your experiences by answering the following questions. 1. How do you find the activity? ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ ________________________________ 2. What was the most challenging or least interesting about the activity? ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ ____________
Reference for learners:
Fundamentals of Accountancy, Business & Management by Joselito G. Florendo,
Answer Key: Activity I 1. C 2. A 3. B 4. D 5. E Activity II 1. Collection, recording, classification, summarization, finalization, and reporting of financial data. 2. Record transactions according to standards and professional ethics. 3. Income statement, Balance Sheet, expense account of the business 4. Providing financial reports to the owners, and other stakeholders 5. Objective of the company. (expansion, profit, stability) Activity III- Answers may vary
10 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
History of Accounting
Background Information for Learners:
Accounting is as old as the civilization itself. It has evolved in response to various social and economic needs of men. Accounting started as a simple recording of repetitive exchanges. The history of accounting is often seen as indistinguishable from the history of finance and business.
Learning Competency with code:
The learner narrates the history/origin of accounting (ABM_FABM11-IIIa-4)
Procedures: Activity I I. Multiple Choice: Choose the correct answer from the options given below. Encircle the letter of the best answer. 1. Who is considered the father of accounting? a. Queen Victoria b. Luca Pacioli c. Augustus d. Suetonius
2. Which order of events portray the history of accounting?
a. Early development in Mesopotamia-Development in Roman Empire →Dissemination of double-entry bookkeeping in the fourteenth century Italy → Signing of charter by Queen Victoria-Formation of Accounting Standard such PAS and PFRS. b. Development of Roman Empire → Early Development in Mesopotamia-Dissemination of double-entry bookkeeping in the fourteenth century Italy-Signing of Charter by Queen Victoria → Formation of accounting standards such as PAS and PFRS c. Early development in Mesopotamia-Development in Roman Empire → Dissemination of double-entry bookkeeping in the fourteenth century Italy → Signing of charter by Queen Victoria
11 d. Early development in Mesopotamia → Development in Roman Empire-Signing of Charter by Queen Victoria → Dissemination of double-entry bookkeeping in the fourteenth century Italy → Formation of accounting standards such as PAS and PFRS.
3. The accounting history covers long period. Which of the following statements regarding the history of accounting is NOT correct? a. PAS and PFRS are the standards followed by the accountants in performing their profession in the present day. b. It is believed that accounting was being used as early as the days of the ancient Mesopotamia. c. During the fourteenth century Italy, the use of single-entry bookkeeping became widespread due to the work of Luca Paciolli. d. The modern profession of chartered accountants originated from Scotland.
4. The double entry system was laid by_______________?
a. Emperor Augustus b. Luca Pacioli c. Queen Victoria d. None of the above’
5. The dissemination of double entry was introduced in______________.
a. The reign of Emperor Augustus b. Cradle civilization c. Fourteenth Century Italy d. Nineteenth Century
Activity II: Directions: Read the events (evolution of accounting) below. They are out of order. Write the number into sequence into the blank space to place the events in order.
_____French revolution-The thorough study of accounting and development of accounting
theory began during this period. Social upheavals affecting government, finances, laws, customs and business had greatly influenced the development of accounting.
____ The Cradle of Civilization-Around 3600 B.C., record-keeping was already common from Mesopotamia, China and India to Central and South America. The oldest evidence of this practice was the “clay tablet” of Mesopotamia which dealt with commercial transactions at the time such as listing of accounts receivable and accounts payable.
_____ 14th Century-Double-Entry Bookkeeping The most important event in accounting
history is generally considered to be the dissemination of double entry bookkeeping by Luca Pacioli (‘The Father of Accounting’) in 14th century Italy. Pacioli was much revered in his day, and was a friend and contemporary of Leonardo da Vinci. The Italians of the 14th to 16th centuries are widely acknowledged as the fathers of modern accounting and were the first to commonly use Arabic numerals, rather than Roman, for tracking business accounts. Luca Pacioli wrote Summa
12 de Arithmetica, the first book published that contained a detailed chapter on double-entry bookkeeping.
_____ The Industrial Revolution (1760-1830) Mass production and the great importance of fixed assets were given attention during this period.
_____ The Development of Modern Accounting Standards and Commerce- The accounting profession in the 20th century developed around state requirements for financial statement audits. Beyond the industry's self-regulation, the government also sets accounting standards, through laws and agencies such as the Securities and Exchange Commission (SEC). As economies worldwide continued to globalize, accounting regulatory bodies required accounting practitioners to observe International Accounting Standards. This is to assure transparency and reliability, and to obtain greater confidence on accounting information used by global investors.
_____ 19th Century – The Beginnings of Modern Accounting in Europe and America. The modern, formal accounting profession emerged in Scotland in 1854 when Queen Victoria granted a Royal Charter to the Institute of Accountants in Glasgow, creating the profession of the Chartered Accountant (CA). In the late 1800s, chartered accountants from Scotland and Britain came to the U.S. to audit British investments. Some of these accountants stayed in the U.S., setting up accounting practices and becoming the origins of several U.S. accounting firms. The first national U.S. accounting society was set up in 1887. The American Association of Public Accountants was the forerunner to the current American Institute of Certified Public Accountants (AICPA)
Activity III: Directions: Identify which era in the history of accounting being illustrated. Write the letter of the correct answer before each number. A. The Cradle Civilization D. The Industrial Revolution B. 14th Century E. 19th Century C. French Revolution F. 20th Century
_____1. Mass production and the great importance of fixed assets were given attention during this period. _____2. The thorough study of accounting and development of accounting theory began during this period. Social upheavals affecting government, finances, laws, customs and business had greatly influenced the development of accounting. _____3. Record-keeping was already common from Mesopotamia, China and India to Central and South America. The oldest evidence of this practice was the “clay tablet” of Mesopotamia which dealt with commercial transactions at the time such as listing of accounts receivable and accounts payable. _____4. The most important event in accounting history is generally considered to be the dissemination of double entry bookkeeping by Luca Pacioli (‘The Father of Accounting’)
13 _____5. In this period rapid changes in accounting practice and reports were made. Accounting standards to be observed by accounting professionals were promulgated. Notable practices such as mergers, acquisitions and growth of multinational corporations were developed. _____6. The modern, formal accounting profession emerged in Scotland in 1854 when Queen Victoria granted a Royal Charter to the Institute of Accountants in Glasgow, creating the profession of the Chartered Accountant (CA). ____7. The accounting profession developed around state requirements for financial statement audits. Beyond the industry's self-regulation, the government also sets accounting standards, through laws and agencies such as the Securities and Exchange Commission (SEC). As economies worldwide continued to globalize, accounting regulatory bodies required accounting practitioners to observe International Accounting Standards. ____8. Double entry in bookkeeping was developed. ____9. Tablet is used as receipt. ___10. It is this era that the accountant is called the eye and the ear of the king.
Activity IV Give at least three examples of how earlier periods made use of the accounting process. 1. ______________________________________________________________ 2. ______________________________________________________________ 3. ______________________________________________________________
Activity V Direction: Answer what is being ask. Why do historians, consider the dissemination of the double-entry bookkeeping of Luca Pacioli in the fourteenth century the most important event in the accounting history? ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _
Guide Questions: 1. How did the accounting develop? 2. What was the most important event in the accounting history? 3. What are the events in the past that lead to the development of accounting?
Rubrics for Scoring
Points 10 There is a clear, well focused idea that stands out and supported by detailed information 8 Main idea is clear but supporting information is general 6 Main idea is somewhat clear, but there is a need for more supporting information
14 4 The main idea is not clear. There is a seemingly random collection of information
Reflection: What was the most challenging or least interesting about this activity? ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ____________
1. Fundamentals of Accountancy, Business, and Management by: Joselito Florendo
Answer Key: Activity I 1. b 2. a 3. c 4. b 5. c Activity II 1. The Cradle of Civilization 2. 14th Century-Double Entry Bookkeeping 3. French Revolution (1700) 4. The Industrial Revolution 5. 19th Century- The Beginnings of Modern Accounting in Europe and America 6. The Development of Modern Accounting Standards and Commerce. Activity III 1. D 2. C 3. A 4. B 5. E 6. E 7. F 8. B 9. A 10. A Activity IV 1. Clay 2. Tablet 3. Daybook/Memos 4. Stewardship Activity V- Answers may vary
15 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
External and Internal Users of Financial Information
Background Information for Learners:
Accounting is called the language of business communicates accounting information to
help many types of users. The user’s need for financial information depend upon the type of decisions to be made. Financial reports supply the information to the internal and external users in order for them to make decisions connected to the business.
Learning Competency with code:
At the end of the activity the students should be able to: 1. Define external users and gives examples (ABM_FABM11-IIIa-7) 2. Define internal users and give examples (ABM_FABM11-IIIa-8)
Procedure:
Activity I
Directions: Classify each of the following as either external user (E), or internal user (I). __________1. Creditor __________2.Employees __________3. Academe __________4.Government __________5.Stockholder __________6.Customer/Client __________7.Potential Investor __________8. Management __________9.General Public __________10.Owners
16 Activity II Directions: Choose the correct answer from the options given below. Circle the letter of the best answer. 1. Which of the following is NOT considered internal user of accounting information? a. Owners of the business b. Suppliers c. Senior partners of audit firm d. Field workers
2. Raymond is a professor in accountancy in the BS Accountancy program of the University
of Sto. Tomas. He is also a stockholder of Northwing Co. In the point of view of Northwing Co., Raymond is an a. Internal User b. External user c. a & b d. none of the above
3. Which of the following is NOT considered an external user of the accounting
information? a. BIR b. Customers c. Production supervisor d. A student of accountancy
4. The government is also an interested outside party that analyzes a company’s financial statements. Which of the following is NOT performed by the government? a. The government encourages or prohibits certain business activities depending on their effect on the economy. b. The government examines financial statements to help companies in formulate business decisions c. The government assesses the taxes payable by companies through the analysis of financial statements. d. The government is a regulatory body that oversees all business.
5. Management consists of the following
a. Top management, supervisors, field workers, board of directors b. Board of directors, supervisors, top management, laborers c. Top management, board of directors, middle managers, supervisors d. Owners, top management, middle managers, supervisors, laborers
6. The group of users of accounting information invested resources to the company with the hope of earning acceptable returns. a. Government b. Potential investors c. Creditors d. Owners or Stockholders
17 7. Which of the following does NOT fall under the category of customer? a. Francis, a loyal gamer in Angel Computer shop. b. Jeff, a client of Optical Shop c. Jose, a regular purchase of soft drink in Lyn’s Sari-Sari Store. d. Juan, an individual collecting monthly payment from Jaja Co.
8. Which of the following information in a company’s financial statements concerns
creditors? a. Amount of profit b. Borrowings of a company c. Assets of a company d. All of the above
9. In what aspect do creditors and potential investors differ?
a. Creditors are wary of the riskiness of a company b. Creditors are exposed to more risk than investors c. Wealthy individuals can only invest not lend to a company. d. Creditors receive fived amount of fee in their loans to the business.
10. Why do costumers look at the companies’ financial statements?
a. To help members of academe to gather data for educational purpose b. To decide whether or not they will lend resources to the company. c. To see if it will be beneficial to build a long-term relationship with the company d. To estimate potential returns if he or she plans to transact with company
Activity III Directions: Search up, down, forward, backward, and on diagonal to find the hidden words. Find the following words: • Government • Management • Employees • Costumers • Banks • Money • Creditors • Stockholders
18 WORD SEARCH
S J Q L M O V L T E T T Y R U A R P A P U G N E C R E C B C G J B E E M M U J D A B F P M P M P X F S D L G Y E J R N L L W E T F O G L J M R O N M I P O A H P E S E Y E Q E M N M Y K U S V E E A W A T J E E C U O E Y R M N R K Y R N O G S S R E N W O Z B S O T J C R E D I T O R S D M S Activity IV
Directions: Supply the missing information.
Types of User Definition Example of Users Benefits from
Accounting Information Customers Main source of 1. Whether or not to income of businesses build relationships with businesses Creditors Provides additional Banks, lending 2. funds when the initial institution, investment of the government owners is exhausted 3. An external user BIR Oversees business, whose primary role is Check the accuracy DOLE to regulate, analyze of financial financial statements DTI statements to determine of taxes payable
19 Management Employees that make Board of Directors, 4. decisions for the top management, company middle-level manager, supervisors Owners Existing investor of 5. Mainly concerned the company; with returns earned concerned mostly with profits of the company Employees Persons in the Laborers, Field 6. company aside from workers, non- managers and owners managerial or stockholders employees
Activity V: Arrange & Identify
Directions: Arrange the jumbled words of the different users of financial information in the box, after which identify each arranged word whether it is internal (I) or external users of financial information. Write your answer on the space provided. 1.NTEMRNEVGO 4.SUCMOTRES 7.KSNAB 2.RECSRTOID 5. AGENAMEMTN 8.MEEDCAA 3.LOPEMEEY 6.WORSEN 9.SRSDHOLAKCOT 10.RSIEPPLUS
Directions: Answer what is being ask. Write your answer on the space provided. 1. Name the two broad categories of users of financial information and give three examples each. ________________________________________________________________________ ________________________________________________________________________ __________________________________________ 2. What kind of information do users need that can be answered by financial statements? ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ ______________________
Guide Questions: 1. Who are the external users? 2. Who are the internal users? 3. What are the benefits do external and internal users get from the financial information?
Rubrics for Scoring
Points 10 There is a clear, well focused idea that stands out and supported by detailed information 8 Main idea is clear but supporting information is general 6 Main idea is somewhat clear. But there is a need for more supporting information 4 The main idea is not clear. There is a seemingly random collection of information
Reflection: Write your brief description of your experiences by answering the following questions. 1. How do you find the activity? ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ ________________________________ ________________________________________________________________________ ________________________________________________________________________ __________________________________________ 2. What did you like most about the activity, and why? ________________________________________________________________________ ________________________________________________________________________
21 ________________________________________________________________________ ________________________________ 3. What was the most challenging about the activity? ________________________________________________________________________ ________________________________________________________________________ ________________________________________________________________________ ________________________________
Reference for learners:
1. Fundamentals of Accountancy, Business, and Management by: Joselito Florendo 2. https://drive.google.com/file/d/0B869YF0KEHr7dW04Xzd3UWRNZW8/view
Answer Key: Activity I 1. E 6.E 2. I 7.E 3. E 8.I 4. E 9.E 5. I 10.I Activity II 1. b 6.d 2. a 7.d 3. c 8.d 4. b 9.a 5. c 10.c Activity IV 1. Patrons, clients, people acquiring goods or services for a fee 2. Determining the credit worthiness of an organization 3. Government 4. Uses financial information in making decisions 5. Laborers, field workers, non-managerial employees 6. Mainly concerns with their investment and to make decisions. Activity V 1. Government/E 6. Owners/I 2. Creditors/E 7. Bank/E 3. Employee/I 8. Academe/E 4. Customers/E 9. Stockholders 5. Management/I 10. Suppliers/E
22 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS, AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
The Accounting Concepts and Principles
23 Background Information or Learners
It seems that you already understood our previous topic. I am glad that you were able to accomplish all the activities in the previous lesson. Can you still differentiate the internal and external users of accounting? I’m sure you can. And I think we are now ready to proceed to the next topic.
In this topic, please be reminded of the principles of accounting as written below before you answer the following activities.
• Business Entity Principle- a business enterprise is separate and distinct from its owner or investor. • Going Concern Principle- business is expected to continue indefinitely. • Time Period Principle- financial statements are to be divided into specific time intervals. • Monetary Unit Principle- amounts are stated into a single monetary unit. • Objectivity Principle- financial statements must be presented with supporting evidence. • Cost Principle- accounts should be recorded initially at cost. • Accrual Accounting Principle- revenue should be recognized when earned regardless of collection and expenses should be recognized when incurred regardless of payment. On the other hand, the cash basis principle in which revenue is recorded when collected and expenses should be recorded when paid. Cash basis is not the generally accepted principle today. • Matching Principle- cost should be matched with the revenue generated. • Disclosure Principle- all relevant and material information should be reported. • Conservatism Principle- also known as prudence. In case of doubt, assets and income should not be overstated while liabilities and expenses should not be understated. • Materiality Principle- in case of assets that are immaterial to make a difference in the financial statements, the company should instead record it as an expense.
So, good luck and enjoy answering the activities!
LEARNING COMPETENCY
Explain the varied accounting concepts and principles (ABM_FABM11-IIIb-c-15), solve
exercises on accounting principles as applied in various cases (ABM_FABM11-IIIb-c-16)
Activity 1: Spot the Difference
The New Munoz Bakeshop
Jeniffer Garcia opened her new bakeshop named The New Munoz Bakeshop. She opened a bank account for her business amounting to P600,000. Her business earned P50,000 but she had doubts with the recorded expense of P60,000. The list of expenses is as follows:
Guide Question: In the situation stated above, what do you think should NOT be included as EXPENSES? Write INCLUDED or NOT INCLUDED on the space provided then explain your answers.
The above activity is an application of the Business Entry Principle which is one of the principles of accounting.
Activity 2: Matching
In this activity, you are going to match the following Accounting Principles with their definitions: write the letter of your answers on the space before each item.
a. Accrual Accounting Principle f. Matching Principle
b. Conservatism Principle g. Materiality Principle c. Cost Principle h. Monetary Unit Principle d. Disclosure Principle i. Objectivity Principle e. Going Concern Principle j. Time Period Principle
_____1. All relevant information should be included in the financial reports.
_____2. In case of doubt, assets and income should not be overstated. _____3. Assume that the company will continue indefinitely. _____4. All transactions should be supported by unbiased evidence. _____5. Expenses should be recorded in the period when the revenue is generated. _____6. Minimal costs incurred should be recorded as an expense. _____7. A Philippine company should report financial statements in pesos. _____8. A barber who performs services for a client should record revenue. _____9. Statement of Financial Position should be recorded as of December 31, 2019. ____10. A company that purchases furniture should record it as its acquisition price.
Are you sure to your answers? You may double check your answers for your assurance.
25 Activity 3: Principle Word Hunt
At this point of our activity, all you have to do is to find the significant terminologies that we have discussed through word hunt. Good luck and enjoy learning!
PROCEDURE
1. Find 10 significant words that was mentioned in the background information.
2. Locate them by running in three possible directions: horizontally (up-down), vertically (left-right), and diagonal. Some words are in inverted form. 3. Use any color to locate the words.
A S G A R D L O R D Y L O F S C E D L A O M I Y A T O P U T C L I U T Y B O H U I N E N U R E S C L A Y L N L V E R N N U N C A N C E R C E I S I E S A A L R P U H U H G T T O L R L D O D R R O O O E C A D I N E Y S U I U O T O N E N R S R P R U L N X C E X D J K K Y E I R R O C O S T T U B U I N C C O E P I E S T V I O S P O N D T E E P M O B I L E N D U O E H L I L S M A T C H I N G C H E R O E U D O R A C L A U D B U B U S I N E S S T U O L E C H A N G E E L L I T E S E D
Closure
In case where application of one accounting concept or principle leads to a conflict with another accounting concept or principle, accountants must consider what is best for the users of the financial information. An example of such a case would be the trade off between relevance and reliability. Information is more relevant if it is disclosed timely. However, it may take more time to gather reliable information. Whether reliability of information may be compromised to ensure relevance of information is a matter of judgment that ought to be considered in the interest of the users of the financial information.
References for Learners
26 Fundamentals of Accountancy, Business and Management 1, P.B. Liquanan, E. B. Ogena, M.A.C. Montealegre, R.V. Diaz, M.C.R.B. Bautista, B.F. Nebres, C.C. Oracion, G. Price, S. Bevins
1. Rent Expense: it should be included since the rent is for the business. 2. Salary Expense: it should be included since it is related to the operation of the business. 3. Utilities Expense (at home): should NOT be included; it is a personal expense 4. Utilities Expense (at the store): should be included; it is an expense of the business. 5. Insurance Expense: should be included since insurance is for the business. 6. Withdrawals: should NOT be included since the withdrawals is for personal use. ACTIVITY 2. MATCHING 1. G 4. B 6. D 9. E 2. J 5. C 7. H 10. F 3. A 6. D 8. I
ACTIVITY 3. PRINCIPLE WORD HUNT
(The answers are in any order) A S G A R D L O R D Y L O F S C E D L A O M I Y A T O P U T C L I U T Y B O H U I N E N U R E S C L A Y L N L V E R N N U N C A N C E R C E I S I E S A A L R P U H U H G T T O L R L D O D R R O O O E C A D I N E Y S U I U O T O N E N R S R P R U L N X C E X D J K K Y E I R R O C O S T T U B U I N C C O E P I E S T V I O S P O N D T E E P M O B I L E N D U O E H L I L S M A T C H I N G C H E R O E U D O R A C L A U D B U B U S I N E S S T U O L E C H A N G E E L L I T E S E D
27 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
The Accounting Equation
28 Background Information for Learners
I am glad that you were able to accomplish all the activities in the previous lesson. Can you still identify the principles of accounting? I’m sure you can. And I think we are now ready to proceed to the next topic.
In this lesson, let us consider the accounting equation which is written as:
ASSETS = LIABILITIES + EQUITY
TAKE NOTE: • That for every transaction, the accounting equation should always be balanced. • That Assets are resources owned by the business. Example: Cash • That Liabilities are obligations by the business. Example: Loans • That Equity is the residual interest of the owner of the business. Meaning, any assets left after paying liabilities is the right of the owner of the business. Example: Capital 4 Elements That Affect Equity 1. Investment 2. Withdrawals 3. Revenue 4. Expenses For further explanation of this topic, let us consider the following example. DATE TRANSACTION Paolo Reyes started a delivery service on July 1, 2019. The following JULY transactions occurred during the month of July.
1 He invested PHP800,000 cash and Cars amounting to PHP200,000
Reyes borrowed PHP100,000 cash from PNB for use in his business. 2 Bought tables and chairs from Orocan and paid PHP45,000 cash
7 Various equipment were purchased on account from Fortune for
PHP55,000 15 Reyes made a cash withdrawal of PHP5,000 for personal use
From the table above, we can notice that the amount of Assets is equal to the sum of Liabilities and Owner’s Equity. It means that the equation is balanced. The table is used to classify the status of the transactions. As you can see, it is organized according to the order of dates. Cash, cars, furniture, and equipment are the identified elements under Assets. Loans payable and accounts payable are obviously under Liabilities, while Reyes, withdrawals and Reyes, capital are under Owner’s Equity.
TAKE NOTE: If the transaction pertains to CASH-OUT, it is written with open and close parenthesis. Example: (45,000)
Learning Competency
The learners shall be able to illustrate the accounting equation (ABM_FABM11-IIIb-c-
8); perform operations involving simple cases with the use of the accounting equation (ABM_FABM11-IIIb-c-9)
Activity 1: Increase/ Decrease
For each transaction, tell whether the Assets (A), Liabilities (L) and Equity (E) will increase (I), decrease (D) or is not affected (NE). A L E 1. The owner invests personal cash in the business. ___ ___ ___ 2. The owner withdraws business assets for personal use. ___ ___ ___ 3. The company receives cash from a bank loan. ___ ___ ___ 4. The company repays the bank that had lent money. ___ ___ ___ 5. The company purchases equipment with its cash. ___ ___ ___
30 6. The owner contributes her personal truck to the business. ___ ___ ___ 7. The company purchases supply on credit. ___ ___ ___ 8. The company purchases land by paying half in cash and signing a note. ___ ___ ___ 9. The owner withdraws cash for personal use. ___ ___ ___ 10. The company repays the suppliers. ___ ___ ___
Activity 2: Describe the Table
In this activity, instead of giving the transaction, the activity below is in reverse. You are going to describe the given transaction. The table is given, study the elements and write down the transaction of the given table.
Are you ready to write down the transactions? I will do the first and last statement for your basis. 1. The owner invested cash of PHP150,000 or the business earned PHP150,000 cash from providing services. 2. ______________________________________________________________ 3. ______________________________________________________________ 4. ______________________________________________________________ 5. ______________________________________________________________ 6. ______________________________________________________________ 7. The owner withdrew supplies worth P8,000 or the business used supplies worth P8,000.
Activity 3. Table Completion
Since you are already done answering the previous activities, I think you are now ready to make your own table using accounting formula. In this activity, you will write the correct entry for each transaction.
Aug. 1 Garcia invested P48,000 cash in the business.
1 Rented office space and paid P800 cash for the August rent. 31 3 Purchased exploration equipment for P22,000 by paying P12,000 cash and agreeing to pay the balance in 3 months. 5 Purchased office supplies by paying P1,500 cash. 6 Completed exploration work and immediately collected P420 cash for the work. 8 Purchased P1,350 of office equipment on credit. 15 Completed exploration work on credit in the amount of P8,000. 18 Purchased P700 of office supplies on credit. 20 Paid cash for the office equipment purchased on August 8. 24 Billed a client P2,400 for work completed; the balance is due in 30 days. 28 Received P5,000 cash for the work completed on August 15. 30 Paid the assistant’s salary of P1,100 cash for this month. 30 Paid P340 cash for this month’s utility bill. 30 Garcia withdrew P1,050 cash from the business for personal use.
ACTIVITY 1. INCREASE/ DECREASE (3 Points/ Item; 30 Total Points*)
3 2 1 0 If all columns of the If only 2 columns are If only 1 column is If nothing is item are correct correct correct correct
32 ACTIVITY 2 . DESCRIBE THE TABLE (3 Points/ Item; 15 Total Points*) 3 2 1 0 Well explained the Almost explained the Slightly explained Did not even give transaction. transaction. the transaction. any explanation of the transaction.
Closure
The fundamental accounting equation, also called the balance sheet equation, represents the relationship between the assets, liabilities, and owner’s equity of a person or business.
References For Learners
Fundamentals of Accountancy, Business and Management 1, P.B. Liquanan, E. B. Ogena,
M.A.C. Montealegre, R.V. Diaz, M.C.R.B. Bautista, B.F. Nebres, C.C. Oracion, G. Price, S. Bevins
A L E 1. The owner invests personal cash in the business. I NE I 2. The owner withdraws business assets for personal use. D NE D 3. The company receives cash from a bank loan. I I NE 4. The company repays the bank that had lent money. D D NE 5. The company purchases equipment with its cash. NE NE NE 6. The owner contributes her personal truck to the business. I NE I 7. The company purchases supplies on credit. I I NE 8. The company purchases land by paying half in cash and signing a note. I I NE 9. The owner withdraws cash for personal use. D NE D 10. The company repays the suppliers. D D NE
ACTIVITY 2. DESCRIBE THE TABLE
33 2. Purchased equipment at P20,000 for cash. 3. The owner withdrew cash of P112,500 or the business incurred P112,500 expenses and paid in cash. 4. The company purchased supplies on account. 5. The owner withdrew cash of P15,000 or the business incurred P15,000 expenses and paid in cash. 6. Paid liabilities worth P53,000.
34 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Five Major Accounts
Background Information for Learners
The expanded accounting equation is composed of five elements. Every time a transaction occurs, we analyze the transaction whether it has a financial effect in the elements of the accounting equation. These elements that we are referring to under the expanded accounting equation are the five major classification of accounts – assets, liabilities, owner’s equity, revenues and expenses. Learning Competency with Code: Discuss the 5 major accounts. (ABM_FABM11-III-d-e-19) ACTIVITY 1 Indicate the classification of the accounts listed below as an ASSET, LIABILITY, EQUITY, INCOME, or EXPENSE account under Column A and as either a Statement of Financial Position account or an Income Statement account under Column B. Accounts Titles Column A Column B 1. Accounts Receivable 2. Building 3. Notes Payable 4. Rent Expense 5. Owner’s Equity 6. Prepaid Expense 7. Inventories
35 8. Interest Income 9. Cash 10. Computer Equipment 11. Utilities Payable 12. Rent Income 13. Unearned Income 14. Land 15. Sales
Procedures: 1. Identify each of the given account. 2. Classify each account as asset, liabilities, equity, income or expenses. 3. Write under Column A your classification of the given account. 4. After classifying, check whether such account is a Statement of Financial Position account or income statement account. Write your answer under Column B. Guide Questions: 1. What are the five major types of accounts? 2. Can you give examples of accounts in each of the five major accounts? 3. What type of account affects the Statement of Financial Position? What about the Income Statement? Rubric for Scoring: 1 point for every correct answer 0 point for incorrect answer Activity 2 Given the following transactions of GD Law Services, determine what accounting element is affected. Write your answer in a sheet of paper. 1. Gina Dy put up her law and notarial office. She invested P200,000.00 as initial investment. 2. She paid P12,000 for stall rent applicable for one year. 3. She purchased a computer equipment worth P30,000.
36 4. She purchased a laptop and a printer worth P40,000 and P10,000, respectively. She paid P30,000, the balance to be paid after 60 days. 5. She purchased office supplies amounting to P3,000. 6. She received consultancy fee from various clients, P15,000. 7. She received professional fee amounting to P30,000. 8. She paid business taxes amounting to P4,650 during the month. 9. She paid P2,000 electricity expense during the month. 10. She paid P12,000 for the salary of her assistant. Procedures:
1. Read each transaction carefully.
2. Analyze the transaction. 3. Determine what specific element of the expanded accounting equation is affected in each transaction. Guide Questions: 1. What are the five major types of accounts? 2. What are the different accounts under each type? 3. What is the journal entry in each transaction? 4. What are the affected accounts and where do they classify? Rubric for Scoring: 1 point each for every correct answer 0 point for incorrect answer Activity 3 Read carefully the following situations. Analyze what each problem is trying to signify. Select the best answer from the given choices. Write the letter of your choice on your answer sheet. 1. You are a business owner. Your business needs additional capital so you borrowed from a bank. You signed a promissory note to pay the loan after a year. Which of the following accounts is increased by the transaction? a. Accounts Payable c. Accounts Receivable b. Notes Payable d. Notes receivable 2. If you are the bank who lent a money to a business owner, which of the following accounts do you think is increased?
37 a. Accounts Payable c. Accounts Receivable b. Notes Payable d. Notes receivable 3. A customer bought goods from your business, on credit. The customer orally promised to pay the goods next week. Which of the following accounts is increased by this transaction? a. Accounts Payable c. Accounts Receivable b. Notes Payable d. Notes receivable 4. From the point of view of the customer who bought goods from your business in #3 above, which of the following accounts is increased? a. Accounts Payable c. Accounts Receivable b. Notes Payable d. Notes Receivable 5. Collection from customers in item #3 will result in an increase to what account? a. Accounts Payable c. Accounts Receivable b. Cash d. Notes Receivable 6. From the point of view of the customer who paid you in #5 above, which of the following accounts is decreased? a. Inventory c. Accounts Receivable b. Cash d. Notes Receivable 7. You purchased a computer for P100,000. Which of the following accounts is increased by this transaction? a. Cash c. Computer equipment b. Owner’s capital d. Inventory 8. Necy, the owner of EN’s Advertising, paid rent in advance for three months. What account on Necy’s books will be increased by this transaction? a. Cash c. Prepaid Expenses b. Accounts Receivable d. Unearned Income 9. If you are the owner of the building being rented by EN’s Advertising, which of the following accounts will be increased? a. Cash c. Prepaid Expenses b. Unearned Income d. both a&b 10. What account under EN’s Advertising will be decreased in transaction #8? a. Cash c. Prepaid Expenses b. Accounts Receivable d. Unearned Income
38 Procedures: 1. Read each transaction carefully. 2. Analyze the transaction. 3. Determine the accounts affected in every given problem. 4. Compute for what is asked in the problem.
Guide Questions: 1. What are the five major types of accounts? 2. What are the different accounts under each type? 3. What is the effect of each problem in the major types of accounts?
Rubric for Scoring:
1 point for every correct answer 0 point for every incorrect answer
Closure: In this activity, I learned that ________________________________________ ___________________________________________________________________ ___________________________________________________________________
References: Financial Accounting and Reporting 2nd ed., 2019, Millan, Z., pp. 104-125 Basic Accounting 4th edition, E. Valencia & G. Roxas., 2014, pp.89-120 Financial Accounting and Reporting, 2nd edition, Z. Millan, 2019, pp.136-137
ANSWER KEY: Activity 1 Accounts Titles Column A Column B
39 1. Accounts Receivable ASSET Statement of Financial Position 2. Building ASSET Statement of Financial Position 3. Notes Payable LIABILITY Statement of Financial Position 4. Rent Expense EXPENSE Income Statement 5. Owner’s Equity EQUITY Statement of Financial Position 6. Prepaid Expense ASSET Statement of Financial Position 7. Inventories ASSET Statement of Financial Position 8. Interest Income INCOME Income Statement 9. Cash ASSET Statement of Financial Position 10. Computer Equipment ASSET Statement of Financial Position 11. Utilities Payable LIABILITY Statement of Financial Position 12. Rent Income INCOME Income Statement 13. Unearned Income LIABILITY Statement of Financial Position 14. Land ASSET Statement of Financial Position 15. Sales INCOME Income Statement
ANSWER KEY: Activity 2 JOURNAL ENTRY ACCOUNTS AFFECTED Account Name DR CR DR CR 1 Cash P 200,000 P Asset Gina, Capital 200,000 Equity 2 Prepaid Rent 12,000 Asset Cash 12,000 Asset 3 Computer Equipment 30,000 Asset Cash 30,000 Asset
ANSWER KEY: Activity 3 1. b 6. b 2. d 7. c 3. c 8. c 4. a 9. d 5. b 10. A
41 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Chart of Accounts Background Information for Learners A chart of account is a listing of accounts used by a company in its operations. It is classified according to the five major types of accounts in the following order: assets, liabilities, equity, revenues, and expenses. Account numbers are assigned to each account to facilitate recording, cross-referencing and retrieval of information. It helps us organize our accounts by type, account number, thus helps us locate easily the transaction information. There is no standard way of assigning account numbers. However, they must be assigned in a manner that the accounts are categorized logically. The larger the company is, the more accounts it use, thus, the more digits in the account numbers. Smaller companies may have fewer accounts and fewer digits in their account numbers.
Learning Competency with code:
Prepare a chart of accounts (ABM_FABM11-IIId-e-21).
ACTIVITY 1 The following are the accounts in the ledger of A Enterprises: Accounts Payable A, Capital Petty Cash Fund Salaries Expense Cash Accounts Receivable Equipment Sales Income Income Tax Payable Accumulated Dep’n.-Equipment Supplies Withholding Tax Payable Interest Expense Prepaid Rent
42 Required: Prepare a chart of accounts for A Enterprises. Using the given account codes, determine the following: 1. Accounts under the asset accounts. 2. Accounts under the liability accounts. 3. Accounts under the equity accounts. 4. Accounts under the revenue accounts. 5. Accounts under the expense accounts.
Procedures: 1. Take a glance at the given accounts. 2. Evaluate which among them belong to the following accounts: assets, liabilities, equity, revenue and expense. 3. Arrange each properly classified account. (After cash account, what comes next?) A ENTERPRISES CHART OF ACCOUNTS ACCOUNT CODE ACCOUNT TITLE Assets: 101 110 120 130 151 155 156
Liabilities: 201 240 250
43 Equity: 301
Income: 401
Expenses 501 530
Guide Questions: 1. How are accounts classified? 2. How is a chart of account arranged? 3. What are account numbers/codes for in the chart of accounts?
Rubric for scoring
2pts each - for properly classified and correctly arranged accounts 1pt each – for properly classified accounts, but incorrectly arranged accounts 0.5 pt each – for accounts not properly classified and arranged
ACTIVITY 2 Directions/Instructions: Complete the password by filling in a word that fits each clue.
44 Across 1. New accounts maybe __________to the chart of accounts as needed. 3. Interest owed on Notes Payable will be recorded as a credit in _______________ payable. 7. A ___________ of accounts is a listing of the accounts. 8. Interest expense and interest revenue/income accounts are classified as “Non-__________ expenses. 10. Unearned revenues and customer deposits are considered as __________ accounts. Down 6. Accumulated depreciation is an example of a ________-asset account. 9. Notes ___________ are obligations supported by written or formal promises to pay by the debtor in the form of promissory notes. 2. The _________ in the account number usually corresponds to how big or small a business is. 4. Revenues earned from rendering of services. 5. Represents the cost incurred on official business trips of employees and those sent to seminars.
Procedures: 1. Read each statement carefully. 2. Determine what each statement refers to.
45 3. Fill each box with the letter of your answer.
Guide Questions: 1. What are the accounts under each of the five major accounts? 2. What do the digits in the account number signify?
Rubric for scoring
Correct answers will earn 1 point. Incorrect answers will earn 0 point.
ACTIVITY 3 Directions/Instructions: Read the following sentences carefully. Choose the best answer from the given choices. Write the letter of your choice on the space provided before each item. (1pt each) _____1. Goods that are held for sale by a business is called a. Inventory c. Accounts Receivable b. Supplies d. Accounts Payable _____2. The unused portion of rent paid in advance is known as a. Prepaid rent c. Rent expense b. Unearned income d. Accrued expense _____3. These are income collected in advance but not yet earned. a. Unearned income c. Service income b. Sales d. Gross income _____4. The cost of supplies used in an accounting period is known as a. Prepaid supplies c. Supplies expense b. Supplies cost d. Inventories _____5. A merchandising or manufacturing business uses this account to record revenues earned from primary business activities. a. Sales c. Gains
46 b. Services income d. Losses _____6. The portion of the cost of building or equipment that has been charged as expense in the current accounting period is called a. Accumulated depreciation c. Depreciation expense b. Accumulated deduction d. Deduction expense _____7. This refers to the costs associated with the usage of electricity, water and communication for a particular accounting period. a. Salaries expense c. Telephone expense b. Utilities expense d. Cost of sales _____8. This represents the costs incurred to register the business, to acquire the right to operate and to settle taxes. a. Taxes and licenses c. Travelling expenses b. Cost of sales d. Salaries expense _____9. Entity A sells an asset that is not an inventory for P100. The carrying amount of the asset is P180. The P80 difference represents a a. gain c. revenue b. loss d. interest income _____10. You opened up a business. Your initial investment to the business will be recorded in which of the following accounts? a. Owner’s payable c. Notes Payable b. Owner’s equity d. Accounts Payable
Guide Questions: 1. In the chart of accounts, what are the account titles used by the business? 2. When do we need to use those accounts in the chart of accounts?
Rubric for scoring
1 point for correct answer 0 point for incorrect answer
47 Closure In this activity, I learned that ____________________________________________ ___________________________________________________________________ ___________________________________________________________________ References Fundamentals of Accountancy, Business and Management 1, J.G.Florendo, 2016, p.156 Basic Accounting 4th ed., E.G. Valencia & G. F. Roxas, 2015, pp.136-137 Financial Accounting and Reporting 2nd ed., Z.B. Millan, 2019, pp.108-117 https://www.accountingcoach.com/chart-of-accounts/crossword-puzzles/1 Financial Accounting and Reporting 2nd ed., Z.B.Millan, 2019, pp.132-135 Fundamentals of Accountancy, Business and Management 1, F.C.Tugas, et al., 2016, pp.58-59
Answer Key Activity 1 A ENTERPRISES CHART OF ACCOUNTS ACCOUNT CODE ACCOUNT TITLE Assets: 101 Cash 110 Petty Cash Fund 120 Accounts Receivable 130 Supplies 151 Prepaid Rent 155 Equipment 156 Accumulated Depreciation – Equipment
49 Answer Key: Activity 3 1. a 6. c 2. a 7. b 3. a 8. a 4. c 9. b 5. a 10. b
50 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
General and Special Journals
Background Information for Learners
In a single day, a company engages in hundreds and thousands of business transactions. Some of these include cash and credit sales, purchases of inventories, payment of expenses, acquisition of equipment, and many more. To keep track of its transactions more efficiently, companies keep and maintain a set of books and/or records called books of accounts. Books of accounts serve as a company’s financial memory and comprise of every single business transactions and financial information of a company. Books of accounts are of two types – journals and ledgers. A journal is a chronological record of company’s transactions listed by date. Most businesses may adopt different kinds of journals but all business organizations use the most basic type of journal which is the general journal referred to as the book of original entry. Aside from the general journal, there are also special journals that are used for voluminous similar transactions. We have four special journals namely cash receipts journal, cash disbursement journal, purchases journal and sales journal.
Learning Competency with code:
Illustrate the format of a general and special journals (ABM_FABM11-IIIf-23).
ACTIVITY 1 Read carefully the given transactions. Record the appropriate transaction in the General Journal using the correct format. Below are the transactions of Juan Manuell Enterprises for the month of May 2018. May 3 Mr. Manuell invested P500,000 cash.
51 May 5 Purchases from Big Dipper Merchants P50,000 merchandise. Terms: 3/10, n/20. May 6 Sold merchandise to Gemini Enterprises, P32,000. Terms: 2/10, n/30. May 9 Purchased office supplies from Galaxy Co. for cash, P3,000 through Check No. 0031. May 11 Gemini Enterprises settled its account in full. Issued OR#10241 May 16 Purchased merchandise from Polaris Trading, P55,000. Terms: P25,000 down payment, balance on account. Terms: 2/10, n/30. Check No. 0032. May 25 Purchased merchandise from Aurora Borealis Systems, P201,600. Terms: 2/10, n/30. May 26 Sold to Virgo Enterprises P150,000 worth of merchandise. Terms: 2/10, n/30. May 30 Purchases from Meteor Trading P80,000. Terms: 2/15, n/30.
Procedures: 1. Prepare a General Journal with the following format:
2. Read and analyze the transactions carefully.
3. Identify appropriate transaction/s that should be recorded in the general journal then fill out the columns properly.
Guide Questions: 1. What important considerations should you have in preparing error-free general journal? 2. What are the significant elements of the general journal? 3. What are the transactions that are to be recorded in the general journal? When does the transaction happened? What are the significant accounts that are affected in the transaction, and by how much?
52 Rubric for scoring Every column in the general journal that is correctly filled out (date, account title and explanation, account codes, amounts in the debit and credit) shall earn 1 pt., while incorrectly filled out columns shall earn no points.
Activity 2 Read carefully the given transactions. Determine which among the following transactions are to be recorded to the Cash Receipts Journal and to the Cash Disbursements Journal. Below are the transactions of Juan Manuell Enterprises for the month of May 2018. May 3 Mr. Manuell invested P500,000 cash. May 5 Purchases from Big Dipper Merchants P50,000. Terms: 3/10, n/20. May 6 Sold merchandise to Gemini Enterprises, P32,000. Terms: 2/10, n/30. May 9 Purchased office supplies from Galaxy Co. for cash, P3,000 through Check No. 0031. May 11 Gemini Enterprises settled its account in full. Issued OR#10241 May 16 Purchased merchandise from Polaris Trading, P55,000. Terms: P25,000 down payment, balance on account. Terms: 2/10, n/30. Check No. 0032. May 25 Purchased merchandise from Aurora Borealis Systems, P201,600. Terms: 2/10, n/30. May 26 Sold to Virgo Enterprises P150,000 worth of merchandise . Terms: 2/10, n/30. May 30 Purchases from Meteor Trading P80,000. Terms: 2/15, n/30.
Procedures: 1. Prepare a Cash Receipt Journal and Cash Disbursements Journal using the formats below:
53 2. Read and analyze the transactions carefully. 3. Select the transactions that needs to be recorded in the cash receipts journal and cash disbursements journal correct. 4. Get the total of each special journal.
Guide Questions: 1. What are the things that you need to consider in preparing cash receipts journal and cash disbursements journal? 2. Can you name some of the transactions that needs to be recorded in the cash receipts journal and cash disbursements journal? 3. What do you think is the difference between the cash receipt journal and the cash disbursement journal in terms of format?
Rubric for scoring
Every column in both journals that is correctly filled out shall earn 1 pt. Incorrectly filled out columns shall earn no points.
ACTIVITY 3 Read carefully the given transactions. Determine which among the following transactions are to be recorded to the Sales Journal and to the Purchases Journal. Below are the transactions of Juan Manuell Enterprises for the month of May 2018. May 3 Mr. Manuell invested P500,000 cash. May 5 Purchases from Big Dipper Merchants P50,000 merchandise. Terms: 3/10, n/20. May 6 Sold merchandise to Gemini Enterprises, P32,000. Terms: 2/10, n/30. May 9 Purchased office supplies from Galaxy Co. for cash, P3,000 through Check No. 0031. May 11 Gemini Enterprises settled its account in full. Issued OR#10241
54 May 16 Purchased merchandise from Polaris Trading, P55,000. Terms: P25,000 down payment, balance on account. Terms: 2/10, n/30. Check No. 0032. May 25 Purchased merchandise from Aurora Borealis Systems, P201,600. Terms: 2/10, n/30. May 26 Sold to Virgo Enterprises P150,000 worth of merchandise. Terms: 2/10, n/30. May 30 Purchases from Meteor Trading P80,000. Terms: 2/15, n/30.
Procedures: 1. Prepare a Sales Journal and Purchases Journal using the formats below:
2. Read and analyze the transactions carefully.
3. Select the transactions that needs to be recorded in each of the special journal (sales journal and purchases journal). 4. Get the total of each special journal.
Guide Questions: 1. What are the things that you need to consider in preparing sales journal and purchases journal? 2. Can you name some of the transactions that can be recorded in the sales journal and purchases journal? 3. What are to be stored in each of the columns of the sales journal and purchases journal? Rubric for scoring Every column in both journals that is correctly filled out shall earn 1 pt., incorrectly filled out columns shall earn no points.
55 Closure In this activity, I learned that ____________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _____________________________________________
References Fundamentals of Accountancy, Business and Management 1, J.G.Florendo, 2016, pp.165-189 Fundamentals of Accountancy, Business and Management 1, F.C.Tugas, et al., 2016, pp.62-64 https://www.accountingformanagement.org/cash-disbursements-journal/ Fundamentals of Accountancy, Business and Management 1, F.C.Tugas, et al., 2016, pp.62-64 https://www.accountingformanagement.org/sales-journal/ https://www.accountingformanagement.org/purchases-journal/
Answer Key Activity 1 JUAN MANUELL ENTERPRISES GENERAL JOURNAL For the Month of May, 2018
Answer Key Activity 2
56 57 Answer Key Activity 3
58 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
General and Subsidiary Ledger
Background Information for Learners
The general ledger (commonly referred by accounting professionals as GL) is a grouping of all accounts that are used to sort and store information necessary in the preparation of financial statements. It contains all the accounts of the company. Unlike journals that are arranged chronologically (regardless of the accounts), the ledgers are usually grouped according to their chart of accounts and arranged according to the order on how they appear on the financial statements. A subsidiary ledger, on the other hand, is a group of like accounts that contains the independent data of a specific general ledger. It is created or maintained if individualized data is needed for a specific general ledger account. An example of a subsidiary ledger is the individual record of various payables to suppliers. Other general ledger accounts that may become control accounts include Inventory, Equipment, and Accounts Receivable.
Learning Competency with code:
Illustrate the format of a general and subsidiary ledger (ABM_FABM11-IIIf-24).
Activity 1: Journalize the following transactions and then post them to the General Ledger. Below are the transactions of Juan Manuell Enterprises for the month of May 2018. May 3 Mr. Manuell invested P500,000 cash. May 5 Purchases from Big Dipper Merchants P50,000 merchandise. Terms: 3/10, n/20. May 6 Sold merchandise to Gemini Enterprises, P32,000. Terms: 2/10, n/30.
59 May 9 Purchased office supplies from Galaxy Co. for cash, P3,000 through Check No. 0031. May 11 Gemini Enterprises settled its account in full. Issued OR#10241 May 16 Purchased merchandise from Polaris Trading, P55,000. Terms: P25,000 down payment, balance on account. Terms: 2/10, n/30. Check No. 0032. May 25 Purchased merchandise from Aurora Borealis Systems, P201,600. Terms: 2/10, n/30. May 26 Sold to Virgo Enterprises P150,000 worth of merchandise. Terms: 2/10, n/30. May 30 Purchases from Meteor Trading P80,000. Terms: 2/15, n/30.
Procedures: 1. Analyze the given transactions. 2. Journalize each transaction in each specific special journal. 3. Post the transactions in the General Ledger.
Guide Questions: 1. What is a General Ledger? 2. What is the format of the General Ledger? 3. How are the accounts in the general ledger arranged?
Rubric for scoring
Each correctly filled out column of the general ledger shall earn 1 point (for each column entry). Incorrectly filled out columns shall earn no point. Activity 2 Utilizing the given problem from the previous activity, prepare a subsidiary ledger for the Accounts Receivable account.
Procedures: 1. Identify which from the given transactions affects the accounts receivable account. 2. Prepare a subsidiary ledger for accounts receivable using the following format.
60 3. Reconcile the balance of the account with the balance that appear in the General Ledger.
Guide Questions: 1. What is accounts receivable subsidiary ledger? 2. Can you illustrate the format of a subsidiary ledger for accounts receivable? 3. Which accounts have subsidiary ledgers aside from accounts receivable? Rubric for scoring Properly and correctly filled-out columns of the subsidiary ledger shall earn 2 points each. Incorrectly filled columns shall earn no point. Activity 3 Utilizing the given problem from the previous activity, prepare a subsidiary ledger for the Accounts Payable account. Procedures: 1. Identify which from the given transactions affects the accounts payable account. 2. Prepare a subsidiary ledger for accounts payable using the following format.
3. Reconcile the balance of the account with the balance that appear in the General Ledger.
Guide Questions: 1. What is an accounts payable subsidiary ledger? 2. Can you illustrate the format of an accounts payable subsidiary ledger? 3. What do you think is the difference between the accounts receivable subsidiary ledger and accounts payable subsidiary ledger? Rubric for scoring Properly and correctly filled-out columns of the subsidiary ledger shall earn 2 points each. Incorrectly filled columns shall earn no point
61 Closure In this activity, I learned that _____________________________________________ ___________________________________________________________________ ___________________________________________________________________
References Fundamentals of Accountancy Business and Management 1, J.P.Florendo, 2016, p. 167 https://accounting-simplified.com https://www.accountingcoach.com/blog/what-is-a-general-ledger https://www.investopedia.com/terms/a/accounts-receivable-subsidiary-ledger.asp
Answer Key: Activity 1
62 63 Answer Key Activity 2
Answer Key Activity 3
64 65 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS, AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Debit and Credit Background Information for Learners
Account Type Normal balance Debit Credit
Asset Debit To increase the To decrease the account account Liability Credit To decrease the To increase the account account Owner’s Equity Credit To decrease the To increase the account account Revenue Credit To decrease the To increase the account account Expense Debit To increase the To decrease the account account
Based in the above summary, increase in an account takes place in the side of its normal balance while a decrease in the account takes place on the opposite side of its normal balance. Recall also the so called contra accounts. Contra accounts can be seen right below the paired (related) account to arrive at the net amount. It normally appears as a reduction below the paired (related a) account to get the net amount. Since contra account reduces the paired (related ) account expect that its normal balance is opposite to the paired(related )account.(Examples of contra accounts-Allowance for Doubtful accounts, Accumulated Depreciation, Sales Discounts, Sales Returns and Allowances ,Purchases Discount, Purchase Returns and Allowances ,etc.)
66 Learning Competency Analyze common business transactions using the rules of debit and credit ABM_FABM11- IIIg- j27 Activity 1 Rules of Debit and Credit Instruction: Complete the table below. The first item has been done for you. List of Accounts Classification Normal Increased by Decreased by Balance (Asset, Liabilities, (Debit/ (Debit/ Owner’s Equity (Debit/ Credit) Credit) Credit) ,Revenue, Expense) 1 Cash Asset Debit Debit Credit 2 Accounts Receivable 3 Merchandise Inventory 4 Prepaid Insurance 5 Supplies 6 Office Equipment 7 Transportation Equipment 8 Building 9 Land 10 Intangible Assets 11 Accounts Payable 12 Notes Payable 13 Salaries Payable 14 Utilities Payable 15 Liam,Capital 16 Liam.Withdrawal 17 Sales 18 Interest Income
Guide Questions: 1. Can you still recall the account tittles that can be seen in the chart of accounts? 2. What are the normal balances of these accounts? 3. When to debit or credit the accounts?
Activity 2 Rules of Debit and Credit
Instruction: Complete the table below. The first item has been done for you. Accounts Normal Balance Increased by Decreased by (Debit/ Credit) (Debit/ Credit) (Debit/ Credit) Allowance for Doubtful Credit Credit Debit accounts Accumulated Depreciation Owner’s Withdrawal Sales Discount
68 Sales Returns Allowances Purchase Discount Purchase Returns and Allowances
Guide Questions: 1. What are contra accounts? 2. How are these accounts presented? 3. What is the effect of these contra accounts to their paired (related) accounts?
Activity 3 Rules of Debit and Credit
Instruction: Underline the correct word to complete the sentences. 1. If I want to increase the asset account, I will (debit, credit) the asset account. 2. If I want to decrease the asset account, I will (debit, credit) the asset account. 3. If I want to increase the liability account, I will (debit, credit) the liability account. 4. If I want to decrease the liability account. I will (debit, credit) the liability account. 5. If I want to increase the owner’s equity account, I will (debit, credit) the owner’s equity account. 6. If I want to decrease the owner’s equity account, I will (debit, credit )the owner’s equity account 7. If I want to increase the revenue account, I will (debit, credit) the revenue account. 8. If I want to decrease the revenue account, I will (debit, credit) the revenue account. 9. If I want to increase my expense account, I will (debit, credit) the expense account. 10. If I want to decrease my expense account , I will (debit, credit) the expense account
Guide Questions 1. What are the five major types of accounts? 2. Can you still recall the rules of debit and credit?
Rubric : Activity Advanced Competent Developing Beginner -Students got -Students got 85- -Students got -Students got 74% 90% and above 89% of the total 75-84% of the and below of the total items items. total items. -Students show show less poor understanding
69 -Student shows -Students show of the understanding of mastery of the understanding of competency the competency the competency. Competency(10) (14) (20) (17) 1
Closure Complete the statements below. 1. I learned that in analyzing business transactions _________________________ ______________________________________________________________________________ ______________________________________________________________________________ _____________________________________________ 2. Knowledge on the elements of accounting equation_______________________ ______________________________________________________________________________ ______________________________________________________________________________ _____________________________________________ References: Ballada, Susan and Ballada Win,Accounting Fundamentals,2012 edition,DomDane Publishers,Manila Philippines Florendo, Joselito G.,Fudamentals of Accountancy, Business and Management 1,Rex Book Store,Manila,Philippines https://www.accountingformanagement.org/rules-of-debit-and-credit/ https://study.com/academy/lesson/using-the-accounting-equation-analyzing-business- transactions.html
70 Answer Key Activity 1 Rules of Debit and Credit
List of Accounts Classification(Asset, Normal Increased Decreased
73 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS, AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Business Transaction Analysis
Background Information for Learners
We analyze the transaction to tell whether the transaction is a financial or a non-financial transaction. A transaction has a financial effect if it affects the accounting equation and it is measurable. Purchase of goods and providing of services for a fee are examples of financial transaction because it affect the elements of the accounting equation. Hiring of employees, sending a pricelist to a prospect customer and business received recognition as one of the best businesses in town, are few examples of non -financial transaction because the elements of the accounting equation are not affected. Transactions that are measurable and have financial effect must be recorded in the book of accounts. Learning Competency Solve simple problems and exercises in the analysis of business transactions. ABM_FABM11- IIIg-j-28
Activity 1 Financial or Non- Financial Transaction
Instruction: Identify whether the following is a financial or a non-financial transaction. Write F if it is a financial transaction and write N if it is a non-financial transaction. Write your answer on the space provided before the number. ______1.Owner invested P100, 000 to the business. ______2.Purchased P5, 000 for business use. ______3.Rendered service to a client and received P5,000. ______4.Rendered service to a client amounting to P3,000 on account.
74 ______5.Acquired transportation equipment amounting to P300,000. ______6. Hired office personnel. ______ 7. Recognize as the best business in town. ______8. Acquired computer equipment and paid P30, 000. ______9.Owner is planning to buy a land and building for office use. ______10.The business owner sends a price list of their products to a prospect customer. Guide Questions 1. What is a business transaction? 2. Can you differentiate a financial from a non-financial transaction? 3. Why do we need to analyze business transactions?
Activity 2 Analysis of Simple Business Transaction
Instructions: 1. Fill in the blanks with the word increase or decrease together with their corresponding amounts in the analysis part of every item. 2. Fill in also the blanks with the correct accounts together with their corresponding amounts in the Rules of Debit and Credit part in every item. Accounts are provided in every item to choose from, all you need to do is to place the accounts either in the debit or credit side.
June 1 Czar is an accountant. After long years of being employed he decided to put up his own business. He made an initial investment amounting to P500, 000 to start this endeavor. Analysis: Asset is ____________ by P___________ Owner’s Equity is ___________ by_________ Rules of Debit and Credit Accounts to use (Cash: Czar,Capital) Debit: _____________ P___________ Credit: _____________ P___________ June 3 Acquired 1 computer for office use, P40,000.
75 Analysis: One asset is _____________ by P_________ Another asset is ____________by P___________
Rules of Debit and Credit(Cash: Computer Equipment)
Accounts to use (Cash: Computer Equipment) Debit: _____________ P___________ Credit: _____________ P___________
June 7 Rendered service to Mr.O amounting to P10,000 on account.
Analysis: Asset is _____________ by P_________ Revenue is ____________by P___________ Rules of Debit and Credit Accounts to use (Accounts Receivable : Service income) Debit: _____________ P___________ Credit: _____________ P___________ June 9 Rendered service to Mr. Po, receiving a cash of P20,000. Analysis: Asset is _____________ by P_________ Revenue is ____________by P___________
Rules of Debit and Credit
Accounts to use (Cash : Service income) Debit: _____________ P___________ Credit: _____________ P___________
June 13 Purchased office supplies amounting P5,000 on account.
Analysis: Asset is _____________ by P_________
76 Liability is ____________by P___________ Rules of Debit and Credit Accounts to use (Supplies : Accounts Payable) Debit: _____________ P___________ Credit: _____________ P___________ June 15 Paid rent for the month amounting P5,000 Analysis: Asset is _____________ by P_________ Expense is ____________by P___________
Rules of Debit and Credit
Accounts to use (Cash: Rent Expense) Debit: _____________ P___________ Credit: _____________ P___________
June 16 Paid salaries of employee P15,000.
Analysis: Asset is _____________ by P_________ Expense is ____________by P___________
Rules of Debit and Credit
Accounts to use (Cash: Salary Expense) Debit: _____________ P___________ Credit: _____________ P___________
June 19 Borrowed P250,000 from a bank.
Analysis: Asset is _____________ by P_________ Liability is ____________by P___________
77 Rules of Debit and Credit Accounts to use (Cash: Loan Payable) Debit: _____________ P___________ Credit: _____________ P___________
June 20 Withdrew P50,000 for personal use.
Analysis: Asset is _____________ by P_________ Owner’s Equity is ____________by P___________
Rules of Debit and Credit
Accounts to use (Cash: Czar, Withdrawal) Debit: _____________ P___________ Credit: _____________ P___________ June 26 Paid water and electric bill amounting to P7,000. Analysis: Asset is _____________ by P_________ Owner’s Equity is ____________by P___________
Rules of Debit and Credit
Accounts to use (Cash: Utilities Expense) Debit: _____________ P___________ Credit: _____________ P___________ June 28 Bought land amounting to P300,000 for office use. Analysis: Asset is _____________ by P_________ Another asset is ____________by P___________
Rules of Debit and Credit
Accounts to use (Cash: Land)
78 Debit: _____________ P___________ Credit: _____________ P___________ June 30 Bought Office equipment amounting to P100,000 paying P30,000 and the balance to paid next month. Analysis: Asset is _____________ by P_________ Another asset is ____________ by P___________ Liability is ______________by P____________
Rules of Debit and Credit
Accounts to use (Cash: Office Equipment: Accounts Payable) Debit: _____________ P___________ Credit: _____________ P___________ Credit: _____________ P___________
Guide Questions 1. Can you still recall the rules of debit credit? 2. How do we increase or decrease an account? 3. Do you agree that debit means to increase an account and credit means to decrease an account?
Activity 3 Analysis of Simple Business Transaction
Multiple Choice. Read each question carefully. Select the best answer from the choices by writing the letter of your choice before the number. 1. Which of the following will most likely increase the liability account by P50,000? A. Bought computer equipment P100,000, paying P50,000 and the balance on account. B. Paid P50, 000 to settle the account in full for the equipment acquired last month. C. Bought P50,000 worth of office supplies. D. Owner invested P50,000 to the business. 2. Which of the following will most likely increase the asset account by P60,000? A. Debit : Accounts Receivable P60,000 B. Debit: Accounts Payable P60,000 C. Debit: Withdrawal P60,000
79 D. Debit: Rent Expense P60,000 3. Which of the following transaction results to a decrease in the asset account? A. Paid P50, 000 to settle the account in full for the equipment acquired last month B. Acquired office equipment worth P60, 000 on account C. Owner invested P5, 000 for personal use D. Borrowed P100,000 from the bank 4. Which among the transactions will result to a debit to an expense account and a credit to asset account? A. Paid salaries of employees B. Collection from customers C. Paid office equipment D. Accrual of salary for the month. 5. Which among the transactions will result to an increase in expense account and increase in liability account? A. Paid salaries of employees B. Collection from customers C. Paid office equipment D. Accrual of salary for the month. 6. The bookkeeper debited an asset account and credited a liability account. Which among the transactions could possibly result to this effect? A. Full settlement of an account to a supplier B. Cash collection from customer C. Withdrawal of owner for personal use D. Sold merchandise on account. 7. Mr. A is a bookkeeper of a rice retailing business. The business purchased a table and paid P10,000. He recorded the transaction by debiting Cash P10,000 and crediting Accounts Payable P10,000. Do you think he recorded the transaction correctly? A. Yes. The transaction was recorded correctly. B. No. The entry should be Debit: Cash P10, 000 Credit: Furniture and Fixtures P10, 000. C. No. The entry should be Debit: Furniture and Fixtures P10, 000 Credit: Cash P10, 000. D. No. The entry should be Debit: Furniture and Fixtures P10, 000 Credit: Owner’s, Capital P10, 000. 8. Which of the following transactions result in an increase in liability account? A. Borrowing of money in a bank B. Purchases on account
80 C. Acquisition of an asset account made a down payment and the remaining balance on account D. All of the above. 9. Which of the following transactions reduce the owner’s equity account? A. Income from the business B. Losses from the business C. Additional investment from the owner D. Purchase of Equipment 10. Which among the following transactions result to an increase the revenue account? A. Rendered bookkeeping services to customer. B. Received advance payment for services to be rendered. C. Accrual of expenses D. Payment of utilities
Guide Questions 1. What are the elements of an expanded accounting equation? 2. Can you still remember the different accounts in your chart of accounts? 3. Can you give example of transactions which results to an increase or decrease in an account?
Rubric Activity Advanced Competent Developing Beginner -Students got 90% -Students got 85- -Students got -Students got and above of the 89% of the total 75-84% of the 74% and below total items items. total items. - -Students show Students show -Student shows -Student shows poor less mastery of the understanding of understanding understanding competency the competency. of the of the competency(10) (20) (17) competency (14) 1
81 Closure: Complete the statements below. 1. I learned in this activity that in analyzing business transaction we need to ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _____________________ 2. Knowing the rules of debit and credit helps me a lot in analyzing business transactions because__________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _____________________
References: Ballada, Susan and Ballada Win,Accounting Fundamentals,2012 edition,DomDane Publishers,Manila Philippines Florendo, Joselito G.,Fudamentals of Accountancy, Business and Management 1,Rex Book Store,Manila,Philippines https://www.accountingformanagement.org/rules-of-debit-and-credit/ https://study.com/academy/lesson/using-the-accounting-equation-analyzing-business- transactions.html Answer Key Activity 1 Financial or Non-Financial Transaction 1.F 2.F 3.F 4.F 5.F 6.N
82 7.N 8.N 9.N 10.N Activity 2 Analysis of Business Transaction June 1 Analysis Asset: (Increase: P500, 000) Owner’ Equity :( Increase: P500, 000) Rules of Debit and Credit Debit: (Cash: P500, 000) Credit: Czar, Capital: P500, 000) June 3 Analysis Asset: (Increase: P40, 000) Asset :( Increase: P 40,000) Rules of Debit and Credit Debit: (Computer Equipment: P40, 000) Credit: (Cash: P40, 000) June 7 Analysis Asset: (Increase: P10, 000) Revenue: :( Increase: P10, 000) Rules of Debit and Credit Debit: (Accounts Receivable: P10, 000) Credit: Service Income: P10, 000) June 9 Analysis Asset: (Increase: P20, 000) Revenue: :( Increase: P20, 000) Rules of Debit and Credit Debit: (Cash: P20, 000) Credit: (Service Income: P20, 000) June 13 Analysis Asset: (Increase: P5, 000)
83 Liability: :( Increase: P5, 000) Rules of Debit and Credit Debit: (Supplies: P5, 000) Credit: (Accounts Payable: P5, 000)
June 15 Analysis Asset: (Decrease: P5, 000) Expense: :( Increase: P5, 000) Rules of Debit and Credit Debit: (Rent Expense: P5, 000) Credit: (Cash: P5, 000) June 16 Analysis Asset: (Decrease: P15, 000) Expense: :( Increase: P15, 000) Rules of Debit and Credit Debit: (Salary Expense: P15, 000) Credit: (Cash: P15, 000) June 19 Analysis Asset: (increase: P250, 000) Liability: :( Increase: P250, 000) Rules of Debit and Credit Debit: (Cash: P250, 000) Credit: (Loan Payable: P250, 000) June 20 Analysis Asset: (increase: P50, 000) Owner’s Equity: :( Decrease: P50, 000) Rules of Debit and Credit Debit: (Czar, Withdrawal: P50, 000) Credit: (Cash: P50, 000)
84 June 26 Analysis Asset: (Decrease: P7, 000) Expense: :( Increase: P7, 000) Rules of Debit and Credit Debit: (Utilities Expense: P7, 000) Credit: (Cash: P7, 000) June 28 Analysis Asset: (Increase: P300, 000) Asset: :( Decrease: P300, 000) Rules of Debit and Credit Debit: (Land: P300, 000) Credit: (Cash: P300, 000) June 30 Analysis Asset: (Increase: 100, 000) Asset: :( Decrease: P30, 000) Liability:( Increase:P70,000) Rules of Debit and Credit Debit: (Office Equipment: P100, 000) Credit: (Cash: P30, 000) Credit: (Accounts Payable:P70,000) Activity 3 1. A 2. A 3. A 4. A 5. A 6. A 7. C 8. D 9. B 10. A
85 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Nature of Transactions in a Service Business
Background Information for Learners:
Any commercial organization engaged in an activity that provides service to clients for profit is called a “service business”. In general, service businesses have no physical product actually sold to clients; instead, their product is “service”. Their service is primarily designed to assist or facilitate the work of clients. A transaction may be business or non-business transactions. A transaction that has an effect on the accounting equation, is a business transaction. Otherwise, it is a non-business transaction.
Learning Competency with Code:
Describes the nature of transactions in a service business. (ABM_FABM11-IVa-d-29)
Activity 1 Directions/Instructions: Look at the pictures below. What can you say about them? Describe their similarities and differences.
Guide Questions: a. What are the three types of businesses according to activities? b. Explain the nature of each types of businesses?
Rubrics for Scoring:
Criteria Rating Content and ideas are organized in a clear, logical 1 2 3 4 5 manner The writing directly addresses the topic and provides 1 2 3 4 5 adequate discussion supporting the main idea The writing employs standard grammar conventions, 1 2 3 4 5 proper punctuation, and proper word choice The sentences are well constructed with varied 1 2 3 4 5 structure
87 Total (20 pts)
Activity 2 Directions/Instructions: Identify whether each transaction is a business or a non-business transaction. Put a check on the column which identifies the nature of the transactions.
Mr. Deryo Laban opened his laundry business last June 2020. The following transactions occurred during the month: Non- Transaction Business Business 1. Invested P300,000 to his business. The trade name of the business was “MR. LABANDERYO”. 2. Hired Kath and James who will manage his business with a monthly salary of P6,000 each. 3. Purchase store supplies from Labada Store- P10,000. 4. MR. LABANDERYO entered into an exclusive contract with RAC Hotel where the business will do all the laundry of the Hotel. 5. Collections from various customers for the day amounting to P15,000. 6. Mr. Deryo Laban signs a subscription contract for an internet plan at P999 per month which will be due at the end of each month. 7. Purchase store supplies worth P10,000 from Mr. Clean Store. 8. Mr. Deryo Laban orders laundry equipment worth P50,000 from Abenson. 9. Paid the salary of the employees for the month, P8,000. 10. Mr. Deryo Laban needed money for the hospitalization of his son. He withdrew P5,000 from the business.
Guide Questions: a. Does it affect the composition of either assets, liabilities, equity, revenues, or expenses? b. Is there a monetary amount that can be assigned to the transaction?
Rubrics for Scoring:
SCORE DESCRIPTION 1 The student has identified correctly the nature of the transaction.
88 0 The student has identified erroneously the nature of the transaction.
Activity 3 Directions/Instructions: Give one service business transaction for the given effects on accounting elements.
1. Increase in one asset and decrease in another asset
2. Increase in asset and increase in liability 3. Increase in asset and increase in owner’s equity 4. Decrease in one liability and increase in another liability 5. Decrease in owner’s equity and decrease in asset 6. Increase in liability and increase in expense 7. Increase in asset and increase in revenue 8. Decrease in asset and increase in expense 9. Decrease in asset and decrease in liability 10. Decrease in liability and increase in owner’s equity
Guide Questions: c. What is a business transaction? d. How do revenue and expenses affect the owner’s equity account?
Rubrics for Scoring:
SCORE DESCRIPTION The student has demonstrated a full and complete understanding of the accounting concepts by writing a service business transaction given its effect 2 and has a mastery on the normal balances of each element. The response may, however, contain minor flaws that do not detract from a demonstration of full understanding. The student has demonstrated merely an acquaintance with the topic, or provided a completely incorrect or uninterpretable response. There are 1 significant omissions and irregularities that indicate a lack of comprehension in regard with its content. 0 No answer at all
Closure: In this activity, I learned that ______________________________________________________________________________ ______________________________________________________________________________
RBS Fundamentals of Accountancy, Business, and Management 1, 1st ed. Teacher’s Guide: Fundamentals of Accountancy, Business, and Management 1. Fundamentals of Accountancy, Business, and Management 1, c2016, Vibal Group, Inc. Valencia, et.al (2003-2004). Basic Accounting International ed. Valencia Educational Supply
Answer Key
Activity 1: Answers may vary
Activity 2: Non- Transaction Business Business 1. Invested P300,000 to his business. The trade name of the business was “MR. LABANDERYO”. 2. Hired Kath and James who will manage his business with a monthly salary of P6,000 each. 3. Purchase store supplies from Labada Store - P10,000.
4. MR. LABANDERYO entered into an exclusive
contract with RAC Hotel where the business will do all the laundry of the Hotel. 5. Collections from various customers for the day amounting to P15,000. 6. Mr. Deryo Laban signs a subscription contract for an internet plan at P999 per month which will be due at the end of each month. 7. Purchase store supplies worth P10,000 from Mr. Clean Store. 8. Mr. Deryo Laban orders laundry equipment worth P50,000 from Abenson. 9. Paid the salary of the employees for the month, P8,000. 10. Mr. Deryo Laban needed money for the hospitalization of his son. He withdrew P5,000 from the business.
90 Activity 3 (Sample Answer): SERVICE BUSINESS TRANSACTIONS
1. The business purchased office supplies for P10,000 cash from Pandayan Bookstore.
2. Purchased medical equipment for P50,000 from Golden Medical Supplies on
account.
3. Mr. Covido started his medical clinic by investing P500,000 as his initial investment.
4. Mr. Covido issued promissory to Golden Medical Supplies to replace the
accounts payable.
5. Mr. Covido withdrew P10,000 cash from the business for personal use.
6. Received electricity bill from Iselco amounting to P5,600.
7. Rendered medical treatment to Mrs. Corona P50,000 on account.
8. Paid the secretary’s salary for the month for P8,000.
9. Paid the electricity consumption for the month which was recorded as utilities payable.
10. Completed the service obligation which was paid by the client in advance.
91 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Journalizing Business Transactions
Background Information for Learners
Journalizing is the process of recording a business transaction in the form of an accounting entry in the “journal” or the so-called “book of the original entry”. The simplest journal is the General Journal. A General Journal is a chronological record of all company’s events or business transactions showing all the effects of each transaction listed by date.
Learning Competency: Record transactions of service business in the general journal. (ABM_FABM11-IVa-d-30)
Activity 1 Directions/Instructions: Analyze the following business transaction of “Barkada Chams Travel”. Journalize the business transactions by following the rules of debits and credits. Use the following account titles: Cash, Accounts Receivable, Prepaid Insurance, Furniture and Fixtures, Office Equipment, Accounts Payable, Notes Payable, Utilities Payable, Loan Payable, Paul, Capital, Paul, Drawing, Service Revenue, Salaries and Wages Expense, Utilities Expense.
Paul decided to put up a travel agency. Below are the transactions for the month of June. June 1 Paul invested cash of ₱ 1,500,000 in the business. 2 Paid Insular Life Insurance Co. P20,000 for one-year insurance of the agency. 3 Borrowed ₱350, 000 from BDO Unibank. 5 Hired office staffs with P10,000 monthly salary. 8 Bought furniture from Jim’s amounting to ₱50,000. 10 Acquired office equipment from Abenson’s P100,000 paying 40,000 and promise to pay the balance at the end of the month. 12 Withdraw cash ₱ 50,000 for personal use. 15 Rendered services from the Happy Travels ₱650,000 on account. 18 Received bill from PLDT, P1,200. 25 Paid employees’ salaries for the month, P60,000.
92 29 Paid electricity bills for the month, P5,000. 30 Collected account from Happy Travels. 30 Paid the balance of the amount owed to Abenson’s.
Date Account Titles & Explanation Ref. Debit Credit
2020 June 1 Cash 1,500,000 Paul, Capital 1,500,000 To record initial investment
2 _______________________ _________ __________________ _________ To record payment of 1-year insurance
3 _______________________ _________ __________________ _________ To record borrowed money from the bank
8 _______________________ _________ __________________ _________ To record purchase of furniture on cash basis
10 _______________________ _________ __________________ _________ __________________ _________ To record purchase of office equipment on instalment basis
12 _______________________ _________ __________________ __________ To record owner’s personal withdrawal
15 _______________________ _________ __________________ __________ To record client’s billed for services rendered
93 18 _______________________ __________ __________________ _________ To record invoice of PLDT bill
25 _______________________ __________ __________________ _________ To record payment of salaries
29 _______________________ __________ __________________ _________ To record payment of electricity
30 _______________________ __________ __________________ _________ To record the collection of client’s account in full
30 _______________________ __________ __________________ _________ To record the payment of the balance of the amount owed
Guide Question: a. Why is there a need to prepare journal entries? b. What are the steps in journalizing transactions? c. Why was hiring an employee not included in the journal?
Rubric for Scoring:
SCORE DESCRIPTION (per Account Title) The student recorded correctly the appropriate account title and its 2 corresponding amount in the debit or credit. The student recorded correctly the appropriate account title but 1 erroneously inputted the amount in the debit or credit, or vice versa. The student recorded erroneously both the account title and its 0 corresponding amount.
94 Activity 2 Directions/Instructions: Analyze the following business transaction of “Coco Repair Shop”. Prepare the appropriate journal entries of the following business transactions in the General Journal. Use the following account titles: Cash, Accounts Receivable, Repair Tools, Repair Supplies, Prepaid Rent, Furniture and Fixtures, Service Equipment, Accounts Payable, Notes Payable, Cardo, Capital, Cardo, Drawing, Service Revenue, Advertising Expense, Salaries and Wages Expense, Utility Expense, Rent Expense, Taxes and Licenses. The company’s business transactions in June, the first month of operations, are described below: TRANSACTIONS June 2020 1 – Cardo opened an appliance repair shop he called “Coco Repair Shop”. He began business by investing P100,000 cash, repair tools-40,000, repair supplies- 18,000 and a truck -150,000. 2 –Rented space and paid two months rent in advance, P10,000. 3 – Paid P2, 500 for newspaper advertising announcing the opening of his shop. 5 – Purchased office tables and chairs and filing cabinets from Martin’s Furniture on account, P20,500. 9 – Completed repair work for Ms. Alyanna on account, P3,500. 10 – Cardo orders 5 boxes of repair supplies from the hardware at P250 per box. 12 – Completed repair work for Mr. Hipolito P 4,300. Accepted P 2,000 cash and a promise to pay the balance after ten days. 15 – Paid the wages of the shop helper, 3, 000. 18 – Paid one-half of the account due to Martin’s Furniture and issued a promissory note for the other half. 22 – Ms. Alyanna paid her account in full. 24 – Withdrew cash for P5,000 for personal use. 26- Received P30,000 from various customers for repair service rendered. 29- Paid the monthly electricity bill and water bill, P 2,300 and P 600, respectively. 30- Paid taxes for P2, 000.
95 30- Paid the wages of the shop helper P 3, 000.
Answer Sheet GENERAL JOURNAL Page 1
Date Particulars Ref. Debit Credit
2020
96 GENERAL JOURNAL Page 2
Date Particulars Ref. Debit Credit
2020
97 98 Guide Question: a. What is the purpose of the General Journal? b. When does a company record a transaction in the General Journal? c. Differentiate simple journal entry from compound journal entry.
Rubric for Scoring:
SCORE 1 point each 0 point (per transaction) (for debit, credit, explanation) The student recorded correctly The student recorded the appropriate account title and erroneously the appropriate Debit its corresponding amount in the account title and/or its debit account. corresponding amount in the debit account. The student recorded correctly The student recorded the appropriate account title and erroneously the appropriate Credit its corresponding amount in the account title and/or its credit account. corresponding amount in the credit account.
99 The student wrote an explanation The student wrote an which really describe the explanation which did not Explanation transaction clearly. describe the transaction, or no explanation at all.
Activity 3 Directions/Instructions: Analyze and journalize the following business transactions of “TMAC Audit Firm”. Record the transactions in the General Journal. Miss Minchin decided to put up an audit firm called “TMAC Audit Firm”. Below are the transactions for the month of June. June 2020 1 Miss Minchin invested P300,000 cash in the business. 2 Paid P10,000 to city hall for a business permit. 3 Purchased table and chairs, P22,000 and office equipment for P28,000 from Venus Home Furniture and Equipment on credit. 3 Paid P2,500 cash to a local newspaper for advertising the opening of the audit firm. 4 Paid Insular Life Insurance Co. P15,000 for one-year insurance of the firm. 5 Rendered audit services to Mrs. Sarah Garcia P21,000 on account. 8 Purchased office supplies from Tess Variety Store on credit P10,200. 10 Billed Mr. Bong Sy on account for P25,000. 11 Paid P20, 000 to Venus Home Furniture and Equipment as partial settlement of the account. 12 Borrowed P100,000 from BDO Unibank. 15 Paid Tess Variety Store the full amount due to it. 17 Paid the monthly rent of the space P5,000. 18 Paid the salary of the secretary, P4,000. 22 Collected P5, 000 from Mrs. Sarah Garcia as partial settlement of her account.
100 23 Received P16,500 from various clients for the services rendered. 25 Paid the electricity, water and telephone bills for the month amounting to P3,200, P800, and P 1,200, respectively. 26 Purchased additional office equipment for P30, 000, paying P5,000 and issuing a note for the remaining P25,000. 28 Withdrew P8, 000 for personal use. 30 Paid the salary of the secretary, P4,000. 30 Paid taxes for P1,500.
Answer Sheet
101 102 103 104 105 Guide Question: a. What are the essential parts of a General Journal? Discuss. b. Why is posting reference not used in when transactions are recorded in the journal?
Rubrics for Scoring:
SCORE 1 point each 0 point (per transaction) (for debit, credit, explanation) The student recorded correctly The student recorded the appropriate account title and erroneously the appropriate Debit its corresponding amount in the account title and/or its debit account. corresponding amount in the debit account. The student recorded correctly The student recorded the appropriate account title and erroneously the appropriate Credit its corresponding amount in the account title and/or its credit account. corresponding amount in the credit account. The student wrote an explanation The student wrote an which really describe the explanation which did not Explanation transaction clearly. describe the transaction, or no explanation at all.
Closure:
106 In this activity, I learned that ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ___________________________________________________
References: RBS Fundamentals of Accountancy, Business, and Management 1, 1st ed. Teacher’s Guide: Fundamentals of Accountancy, Business, and Management 1. Fundamentals of Accountancy, Business, and Management 1,c2016, Vibal Group, Inc. Accounting Cycle (n.d) Retrieved from http://www.investopedia.com/terms/a/accounting- cycle.asp Valencia, et.al (2003-2004). Basic Accounting International ed. Valencia Educational Supply
Answer Key Activity 1:
Date Account Titles & Explanation Ref. Debit Credit
2020 June 1 Cash 1,500,000 Paul, Capital 1,500,000 To record initial investment
2 Prepaid Insurance 20,000
Cash 20,000 To record payment of 1-year insurance
3 Cash 350,000 Loan Payable 350,000 To record borrowed money from the bank
5 No entry
107 8 Furniture and Fixtures 50,000 Cash 50,000 To record purchase of furniture on cash basis
10 Office equipment 100,000
Cash 40,000 Accounts Payable 60,000 To record purchase of office equipment on instalment basis
12 Paul, Drawing 50,000
Cash 50,000 To record owner’s personal withdrawal
15 Accounts Receivable 650,000
Service Revenue 650,000 To record client’s billed for services rendered
18 Utilities Expense 1,200
Utilities Payable 1,200 To record invoice of PLDT bill
25 Salaries and Wages Expense 60,000
Cash 60,000 To record payment of salaries
29 Utilities Expense 5,000
Cash 5,000 To record payment of electricity
30 Cash 650,000 Accounts Receivable 650,000 To record the collection of client’s account in full
30 Accounts Payable 60,000
Cash 60,000 To record the payment of the balance of the amount owed
108 Activity 2: GENERAL JOURNAL Page 1
Date Particulars Ref. Debit Credit
2020 June 1 Cash 100,000 Repair Tools 40,000 Repair Supplies 18,000 Service Equipment 150,000 Cardo, Capital 308,000 To record initial investment
2 Prepaid Rent 10,000
Cash 10,000 To record advance payment of rent
3 Advertising Expense 2,500
Cash 2,500 To record payment of advertising
5 Furniture and Fixtures 20,500
Accounts Payable 20,500 To record purchase of furniture and fixtures on account
9 Accounts Receivable 3,500
Service Revenue 3,500 To record clients billed for services
109 rendered
10 No entry
12 Cash 2,000 Accounts Receivable 2,300 Service Revenue 4,300 To record partial payment from client for services rendered
15 Salaries and Wages Expense 3,000
Cash 3,000 To record payment of helper’s wage
18 Accounts Payable 20,500
Cash 10,250 Notes Payable 10,250 To record partial payment of account and issuance of note for the balance
GENERAL JOURNAL Page 2
Date Particulars Ref. Debit Credit
2020 June 22 Cash 3,500 Accounts Receivable 3,500 To record collection of client’s account
110 24 Cardo, Drawing 5,000 Cash 5,000 To record owner’s personal withdrawal
26 Cash 30,000 Service Revenue 30,000 To record cash received for services rendered
29 Utilities Expense 2,900
Cash 2,900 To record payment of electricity and and water bill for the month
30 Taxes and Licenses Expense 2,000
Cash 2,000 To record payment of tax
30 Salaries and Wages Expense 3,000
Cash 3,000 To record payment of helper’s wage
111 Activity 3: GENERAL JOURNAL Page 1
Date Particulars Ref. Debit Credit
2020 June 1 Cash 300,000 Minchin, Capital 300,000 To record initial investment
2 Taxes and Licenses Expense 10,000
Cash 10,000 To record payment of business permit
3 Furnitures and Fixtures 22,000
Office Equipment 28,000
112 Accounts Payable 50,000 To record purchase of furniture and office equipment on account
3 Advertising Expense 2,500
Cash 2,500 To record payment of advertising
4 Prepaid Insurance 15,000
Cash 15,000 To record payment of 1year insurance
5 Accounts Receivable 21,000
Service Revenue 21,000 To record clients billed for services rendered
8 Office Supplies 10,200
Accounts Payable 10,200 To record purchase of office supplies on account
10 Account Receivable 25,000
Service Revenue 25,000 To record clients billed for services rendered
113 11 Accounts Payable 20,000 Cash 20,000 To record partial payment to Venus Home Furniture and Equipment
GENERAL JOURNAL Page 2
Date Particulars Ref. Debit Credit
2020 June 12 Cash 100,000 Loan Payable 100,000 To record borrowed money from the bank
15 Accounts Payable 10,200
Cash 10,200 To record full payment to Tess Variety Store
17 Rent Expense 5,000
Cash 5,000 To record payment of rent
18 Salary Expense 4,000
Cash 4,000 To record payment of salary
22 Cash 5,000
114 Accounts Receivable 5,000 To record collection of client’s account
23 Cash 16,500 Service Revenue 16,500 To record cash received for services rendered
25 Utility Expense 5,200
Cash 5,200 To record payment of utilities
26 Office Equipment 30,000
Cash 5,000 Notes Payable 25,000 To record purchase of equipment paying cash and issued notes for the balance
28 Minchin, Drawing 8,000
Cash 8,000 To record owner’s personal withdrawal
GENERAL JOURNAL Page 3
Date Particulars Ref. Debit Credit
2020
115 June 30 Salary Expense 4,000 Cash 4,000 To record payment of salary
30 Taxes and Licenses Expense 1,500
Cash 1,500 To record payment of tax
116 117 FUNDAMENTALS OF ACCOUNTANCY BUSINESS AND MANAGEMENT 1 Name of the Learner: ________________________________ Grade Level: _________ Section: ___________________________________________ Date: _______________
LEARNING ACTIVITY SHEET
Posting to the Ledger
Background Information for Learners
After journalizing, the next step in the accounting cycle is posting. Posting refers to the procedure of transferring information in the journal to the ledger accounts. It is for this reason that a ledger is the so-called “book of the final entry”. A ledger contains all the accounts maintained by the business. It is used to accumulate and classify individual transactions from the journal. The transactions recorded in the general journal are posted to the general ledger at the end of each day, week or month depending on the needs of the business to update the account balances.
Learning Competency: Posts transactions in the ledger. (ABM_FABM11-IVa-d-31)
Activity 1 Directions/Instructions: Based from the given general journal, post the transactions in the general ledger. Mr. Vico started to started his own consultancy firm in June 2020. During the first month of his business, he journalized the following transactions in the business’ General Journal. GENERAL JOURNAL Page 1
Date Particulars Ref. Debit Credit
2020 June 1 Cash 200,000 Vico, Capital 200,000 To record owner’s initial investment
3 Office Equipment 25,000
Cash 25,000
118 To record the purchase of one computer unit.
8 Accounts Receivable 15,000
Service Revenue 15,000 To record clients billed for services rendered
15 Office Supplies 5,000
Accounts Payable 5,000 To record purchase of office supplies on account
18 Cash 10,000 Service Revenue 10,000 To record cash received for services rendered
23 Cash 5,000 Accounts Receivable 5,000 To record partial payment of client’s account
28 Vico, Drawing 5,000
Cash 5,000 To record owner’s personal withdrawal
119 30 Salaries Expense 4000 Cash 4000 To record payment of secretary’s salary
Answer Sheet
GENERAL LEDGER Account Title: CASH Account No. 101 Date Explanation Ref. Debit Credit Balance 2020
GENERAL LEDGER Account Title: Accounts Receivable Account No. 102 Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Office Supplies Account No. 103 Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Office Equipment Account No. 104 Date Explanation Ref. Debit Credit Balance
120 GENERAL LEDGER Account Title: Accounts Payable Account No. 201 Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Vico, Capital Account No. 301 Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Vico, Drawing Account No. 302 Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Service Revenue Account No. 401 Date Explanation Ref. Debit Credit Balance
121 GENERAL LEDGER Account Title: Salaries and Wages Expense Account No. 501 Date Explanation Ref. Debit Credit Balance
Guide Question: 1. Differentiate general journal from a general ledger. 2. Is every transaction posted immediately to the ledger? Why or why not?
Rubric for Scoring:
SCORE 1 point each (post per date 0 point (per Ledger) and ending balance)
The student posted correctly and The student posted erroneously
completely the date, the date, explanation, reference explanation, reference number, number, and/or both the amount Post per date and both the amount in the in the debit/credit column and in debit/credit column and in the the balance column. balance column. The student computed the The student computed the Ending Balance ending balance accurately. ending balance inaccurately.
metry, M
122 Activity 2 Directions/Instructions: Journalize the business transactions of Coco Repair Shop and post the transactions in the General Ledger. Use the following account codes: Cash(101), Accounts Receivable (102), Repair Tools (103), Repair Supplies (104), Prepaid Rent(105), Furniture and Fixtures (106), Service Equipment (107), Accounts Payable(201), Notes Payable (202), Cardo, Capital (301), Cardo, Drawing (302), Service Revenue (401), Advertising Expense(501), Salaries Expense (502), Utilities Expense (503), Taxes and Licenses (504), Rent Expense (505). The company’s business transactions in June, the first month of operations, are described below: TRANSACTIONS June 2020 1 – Cardo opened an appliance repair shop he called “Coco Repair Shop”. He began business by investing P100,000 cash, repair tools-40,000, repair supplies- 18,000 and a truck -150,000. 2 –Rented space and paid two months rent in advance, P10,000. 3 – Paid P2, 500 for newspaper advertising announcing the opening of his shop. 5 – Purchased office tables and chairs and filing cabinets from Martin’s Furniture on account, P20,500. 9 – Completed repair work for Ms. Alyanna on account, P3,500. 10 – Cardo orders 5 boxes of repair supplies from the hardware at P250 per box. 12 – Completed repair work for Mr. Hipolito P 4,300. Accepted P 2,000 cash and a promise to pay the balance after ten days. 15 – Paid the wages of the shop helper, 3, 000. 18 – Paid one-half of the account due to Martin’s Furniture and issued a promissory note for the other half. 22 – Ms. Alyanna paid her account in full. 24 – Withdrew cash for P5,000 for personal use. 26- Received P30,000 from various customers for repair service rendered. 29- Paid the monthly electricity bill and water bill, P 2,300 and P 600, respectively. 30- Paid taxes for P2, 000. 30- Paid the wages of the shop helper P 3, 000.
123 Answer Sheet
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance 2020
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
124 GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
125 GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
126 GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
GENERAL LEDGER Account Title: Account No. Date Explanation Ref. Debit Credit Balance
Guide Question: 1. What are the advantages of the use of a ledger? 2. What are the steps in posting from the Journal to the Ledger?
Rubrics for Scoring:
SCORE 1 point each (post per date 0 point (per Account) and ending balance)
The student posted correctly and The student posted erroneously
Post per date completely the date, the date, explanation, reference explanation, reference number, number, and/or both the amount and both the amount in the
127 debit/credit column and in the in the debit/credit column and in balance column. the balance column. The student computed the The student computed the Ending Balance ending balance accurately. ending balance inaccurately.
Activity 3 Directions/Instructions: Journalize the business transactions of TMAC Audit Firm and post the transactions in the General Ledger. Miss Minchin decided to put up an audit firm called “TMAC Audit Firm”. Below are the transactions for the month of June. June 2020 1 Miss Minchin invested P300,000 cash in the business. 2 Paid P10,000 to city hall for a business permit. 3 Purchased table and chairs, P22,000 and office equipment for P28,000 from Venus Home Furniture and Equipment on credit 3 Paid P2,500 cash to a local newspaper for advertising the opening of the audit firm. 4 Paid Insular Life Insurance Co. P15,000 for one-year insurance of the firm. 5 Rendered audit services to Mrs. Sarah Garcia P21,000 on account. 8 Purchased office supplies from Tess Variety Store on credit P10,200. 10 Billed Mr. Bong Sy on account for P25,000. 11 Paid P20, 000 to Venus Home Furniture and Equipment as partial settlement of the account. 12 Borrowed P100,000 from BDO Unibank. 15 Paid Tess Variety Store the full amount due to it. 17 Paid the monthly rent of the space P5,000. 18 Paid the salary of the secretary, P4,000. 22 Collected P5, 000 from Mrs. Sarah Garcia as partial settlement of her account. 23 Received P16,500 from various clients for the services rendered.
128 25 Paid the electricity, water and telephone bills for the month amounting to P3,200, P800, and P 1,200, respectively. 26 Purchased additional office equipment for P30, 000, paying P5,000 and issuing a note for the remaining P25,000. 28 Withdrew P8, 000 for personal use. 30 Paid the salary of the secretary, P4,000. 30 Paid taxes for P1,500.
TMAC Audit Firm uses the following chart of accounts:
129 130 131 132 Guide Question: 1. What are the essential parts of the General Ledger? Discuss 2. Compute the total amount of the following: a. Total Assets b. Total Liabilities c. Total Owner’s Equity d. Total Revenue e. Total Expenses
133 Rubrics for Scoring: SCORE 1 point each (per Ledger) (post per date and ending 0 point balance) The student posted correctly and The student posted erroneously completely the date, explanation the date, explanation of the of the transaction, reference transaction, reference number, Post per date number, and both the amount in and/or both the amount in the the debit/credit column and in debit/credit column and in the the balance column. balance column. The student computed the The student computed the Ending Balance ending balance accurately. ending balance inaccurately.
Closure: In this activity, I learned that ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ _________________________________________________________
References: RBS Fundamentals of Accountancy, Business, and Management 1, 1st ed. Teacher’s Guide: Fundamentals of Accountancy, Business, and Management 1. Fundamentals of Accountancy, Business, and Management 1, c2016, Vibal Group, Inc. Accounting Cycle (n.d) Retrieved from http://www.investopedia.com/terms/a/accounting- cycle.asp Valencia, et.al (2003-2004). Basic Accounting International ed. Valencia Educational Supply Answer Key Activity 1
GENERAL LEDGER Account Title: CASH Account No. 101 Date Explanation Ref. Debit Credit Balance 2020 June 1 Cash Investment of the owner J1 200,000 200,000 3 Purchase of office equipment J1 25,000 175,000 18 Cash received for services rendered J1 10,000 185,000 23 Partial payment of client’s account J1 5,000 190,000
134 28 Withdrawal of cash from the business J2 5,000 185,000 30 Payment of salary J2 4,000 181,000 Balance 181,000
GENERAL LEDGER Account Title: Accounts Receivable Account No. 102 Date Explanation Ref. Debit Credit Balance 2020 June 8 Billed client for services rendered J1 15,000 15,000 23 Partial payment of clients account J1 5,000 10,000 30 Balance 10,000
GENERAL LEDGER Account Title: Office Supplies Account No. 103 Date Explanation Ref. Debit Credit Balance 2020 June15 Purchase of office supplies on account J1 5,000 5,000 30 Balance 5,000
GENERAL LEDGER Account Title: Office Equipment Account No. 104 Date Explanation Ref. Debit Credit Balance 2020 June 3 Purchase of office equipment J1 25,000 25,000 30 Balance 25,000
GENERAL LEDGER Account Title: Accounts Payable Account No. 201 Date Explanation Ref. Debit Credit Balance 2020 June15 Purchase of office supplies on account J1 5,000 5,000 30 Balance 5,000 GENERAL LEDGER Account Title: Vico, Capital Account No. 301 Date Explanation Ref. Debit Credit Balance 2020 June 1 Investment of capital by the owner J1 200,000 200,000 30 Balance 200,000
135 GENERAL LEDGER Account Title: Vico, Drawing Account No. 302 Date Explanation Ref. Debit Credit Balance 2020 June 28 Withdrawal of cash from the business J1 5,000 5,000 30 Balance 5,000
GENERAL LEDGER Account Title: Service Revenue Account No. 401 Date Explanation Ref. Debit Credit Balance 2020 June 8 Rendered services on account J1 15,000 15,000 18 Rendered services through cash J1 10,000 25,000 30 Balance 25,000
GENERAL LEDGER Account Title: Salaries and Wages Expense Account No. 501 Date Explanation Ref. Debit Credit Balance 2020 June 30 Payment of salary J1 4,000 4,000 Balance 4,000
Activity 2
GENERAL LEDGER Account Title: CASH Account No. 101 Date Explanation Ref. Debit Credit Balance 2020 June 1 Cash Investment of the owner J1 100,000 100,000 2 Payment of advance payment of rent J1 10,000 90,000 3 Payment of advertising J1 2,500 87,500 12 Partial payment from supplier J1 2,000 89,500 15 Payment of salary J1 3,000 86,500 18 Partial payment to supplier J1 10,250 76,250 22 Cash collection of client’s account J2 3,500 79,750 24 Withdrawal of cash from the business J2 5,000 74,750
136 26 Cash received for services rendered J2 30,000 104,750 29 Payment of utility bills J2 2,900 101,850 30 Payment of tax J2 2,000 99,850 30 Payment of salary J2 3,000 96,850 Balance 96,850
GENERAL LEDGER Account Title: Accounts Receivable Account No. 102 Date Explanation Ref. Debit Credit Balance 2020 June 9 Billed client for services rendered J1 3,500 3,500 12 Billed client for services rendered J1 2,300 5,800 22 Collection of clients account J2 3,500 2,300 30 Balance 2,300
GENERAL LEDGER Account Title: Repair Tools Account No. 103 Date Explanation Ref. Debit Credit Balance 2020 June 1 Investment of repair tools J1 40,000 40,000 30 Balance 40,000
GENERAL LEDGER Account Title: Repair Supplies Account No. 104 Date Explanation Ref. Debit Credit Balance 2020 June 1 Investment of repair supplies J1 18,000 18,000 30 Balance 18,000
GENERAL LEDGER Account Title: Prepaid Rent Account No. 105 Date Explanation Ref. Debit Credit Balance 2020 June 3 Advance payment of rent J1 10,000 10,000 30 Balance 10,000
GENERAL LEDGER Account Title: Furniture and Fixtures Account No. 106
137 Date Explanation Ref. Debit Credit Balance 2020 June 5 Purchase of furniture on account J1 20,500 20,500 30 Balance 20,500
GENERAL LEDGER Account Title: Service Equipment Account No. 107 Date Explanation Ref. Debit Credit Balance 2020 June 1 Investment of service equipment J1 150,000 150,000 30 Balance 150,000
GENERAL LEDGER Account Title: Accounts Payable Account No. 201 Date Explanation Ref. Debit Credit Balance 2020 June 3 Purchase of furniture on account J1 20,500 20,500 18 Partial payment to supplier J1 20,500 0 30 Balance 0
GENERAL LEDGER Account Title: Notes Payable Account No. 202 Date Explanation Ref. Debit Credit Balance 2020 June 18 Issuing note in exchange of balance J1 10,250 10,250 account 30 Balance 10,250
GENERAL LEDGER Account Title: Coco, Capital Account No. 301 Date Explanation Ref. Debit Credit Balance 2020 June 1 Investment of capital by owner J1 308,000 308,000 30 Balance 308,000
138 GENERAL LEDGER Account Title: Coco, Drawing Account No. 302 Date Explanation Ref. Debit Credit Balance 2020 June 24 Withdrawal of cash from the business J2 5,000 5,000 30 Balance 5,000
GENERAL LEDGER Account Title: Service Revenue Account No. 401 Date Explanation Ref. Debit Credit Balance 2020 June 9 Rendered services on account J1 3,500 3,500 12 Rendered services on installment basis J1 4,300 7,800 26 Rendered services through cash J2 30,000 37,800 30 Balance 37,800
GENERAL LEDGER Account Title: Advertising Expense Account No. 501 Date Explanation Ref. Debit Credit Balance 2020 June 3 Payment of advertising J1 2,500 2,500 30 Balance 2,500
GENERAL LEDGER Account Title: Salaries and Wages Expense Account No. 502 Date Explanation Ref. Debit Credit Balance 2020 June 15 Payment of salary J1 3,000 3,000 30 Payment of salary J2 3,000 6,000 Balance 6,000
GENERAL LEDGER Account Title: Utilities Expense Account No. 503 Date Explanation Ref. Debit Credit Balance 2020
139 June 29 Payment of utility bills J2 2,900 2,900 30 Balance 2,900
GENERAL LEDGER Account Title: Taxes and Licenses Expenses Account No. 504 Date Explanation Ref. Debit Credit Balance 2020 June 30 Payment of tax J2 2,000 2,000 Balance 2,000
GENERAL LEDGER Account Title: Rent Expense Account No. 505 Date Explanation Ref. Debit Credit Balance
Activity 3
GENERAL LEDGER Account Title: CASH Account No. 101 Date Explanation Ref. Debit Credit Balance 2020 June 1 Cash investment by the owner J1 300,000 300,000 2 Payment of business permit J1 10,000 290,000 3 Payment of advertising J1 2,500 287,500 4 Payment of 1-year insurance J1 15,000 272,500 11 Partial payment to supplier J1 20,000 252,500 12 Borrowed cash from the bank J2 100,000 352,500 15 Full payment to supplier J2 10,200 342,300 17 Payment of rent J2 5,000 337,300 18 Payment of salary J2 4,000 333,300 22 Collection of client’s account J2 5,000 338,300 23 Cash received from services rendered J2 16,500 354,800 25 Payment of utilities J2 5,200 349,600 26 Partial payment to supplier J2 5,000 344,600 28 Withdrawal of cash from the business J2 8,000 336,600 30 Payment of salary J3 4,000 332,600
140 30 Payment of tax J3 1,500 331,100 Balance 331,100
GENERAL LEDGER Account Title: Accounts Receivable Account No. 102 Date Explanation Ref. Debit Credit Balance 2020 June 5 Billed client for services rendered J1 21,000 21,000 10 Billed client for services rendered J1 25,000 46,000 22 Collection of clients account J2 5,000 41,000 30 Balance 41,000
GENERAL LEDGER Account Title: Office Supplies Account No. 103 Date Explanation Ref. Debit Credit Balance 2020 June 8 Purchase of office supplies on account J1 10,200 10,200 30 Balance 10,200
GENERAL LEDGER Account Title: Prepaid Insurance Account No. 104 Date Explanation Ref. Debit Credit Balance 2020 June 3 Payment of 1-year insurance J1 15,000 15,000 30 Balance 15,000
GENERAL LEDGER Account Title: Office Equipment Account No. 105 Date Explanation Ref. Debit Credit Balance 2020 June 3 Purchase of office equipment on account J1 28,000 28,000 26 Purchase of office equipment on J2 30,000 58,000 installment basis 30 Balance 58,000
141 GENERAL LEDGER Account Title: Furniture and Fixtures Account No. 106 Date Explanation Ref. Debit Credit Balance 2020 June 3 Purchase of furniture on account J1 22,000 22,000 30 Balance 22,000
GENERAL LEDGER Account Title: Accounts Payable Account No. 201 Date Explanation Ref. Debit Credit Balance 2020 June 3 Purchase of furniture and equipment on J1 50,000 50,000 account 8 Purchase of office supplies on account J1 10,200 60,200 11 Partial payment to supplier J1 20,000 40,200 15 Full payment to supplier J2 10,200 30,000 30 Balance 30,000
GENERAL LEDGER Account Title: Notes Payable Account No. 202 Date Explanation Ref. Debit Credit Balance 2020 June 26 Purchase of equipment issuing note J2 25,000 25,000 30 Balance 25,000
GENERAL LEDGER Account Title: Loan Payable Account No. 203 Date Explanation Ref. Debit Credit Balance 2020 June 12 Borrowed cash from the bank J2 100,000 100,000 30 Balance 100,000
142 GENERAL LEDGER Account Title: Minchin, Capital Account No. 301 Date Explanation Ref. Debit Credit Balance 2020 June 1 Investment of capital by owner J1 300,000 300,000 30 Balance 300,000
GENERAL LEDGER Account Title: Minchin, Drawing Account No. 302 Date Explanation Ref. Debit Credit Balance 2020 June 26 Withdrawal of cash from the business J2 8,000 8,000 30 Balance 8,000
GENERAL LEDGER Account Title: Service Revenue Account No. 401 Date Explanation Ref. Debit Credit Balance 2020 June 5 Rendered services on account J1 21,000 21,000 10 Rendered services on account J1 25,000 46,000 23 Rendered services through cash J2 16,500 62,500 30 Balance 62,500
GENERAL LEDGER Account Title: Taxes and Licenses Expenses Account No. 501 Date Explanation Ref. Debit Credit Balance 2020 June 2 Payment of business permit J1 10,000 10,000 30 Payment of tax J3 1,500 11,500 Balance 11,500
GENERAL LEDGER Account Title: Advertising Expense Account No. 502 Date Explanation Ref. Debit Credit Balance 2020
143 June 26 Payment of advertising J1 2,500 2,500 30 Balance 2,500
GENERAL LEDGER Account Title: Rent Expense Account No. 503 Date Explanation Ref. Debit Credit Balance 2020 June 26 Payment of rent J2 5,000 5,000 30 Balance 5,000
GENERAL LEDGER Account Title: Salary Expense Account No. 504 Date Explanation Ref. Debit Credit Balance 2020 June 18 Payment of salary J2 4,000 4,000 30 Payment of salary J3 4,000 8,000 Balance 8,000
GENERAL LEDGER Account Title: Utility Expense Account No. 505 Date Explanation Ref. Debit Credit Balance 2020 June 25 Payment of utility bills J2 5,200 5,200 30 Balance 5,200
144 FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1 Name of Learner: ________________________________ Grade Level: _______________ Section: ________________________________________ Date: _____________________
LEARNING ACTIVITY SHEET
Prepare a Trial balance
Background Information for Learners
Posting to the ledger is the last part of the recording phase of the accounting process. After learning this, we shall start summarizing with the preparation of trial balance. An unadjusted trial balance is the listing of a general ledger account at the end of a reporting period, before any adjusting entries are made to the balances to prepare financial statements. It will be used as the starting point for analysing account balances and making adjusting entries. It shows all accounts with their corresponding balances, segregated into debit and credit columns. The accounts that should appear are those that are open accounts. And the accounts should appear in order: assets, liabilities, equity, revenues and expenses. If there are no adjustments, the accounts as reflected in the trial balance can now be used as the data in preparing the financial statements. if there are still adjustments, they must be reflected to update the amount of the affected accounts. If the total debit does not equal the credit column then this would show that there is an error therefore you will not proceed in preparing the accounting process until the errors are corrected. However, a “balanced” trial balance does not guarantee the accuracy of the journalizing and posting.
Steps in preparing Trial Balance
1. Indicate in the heading the details of Trial Balance (Business name, the title of the accounting work “Trial Balance” and the date of the trial balance). Use the centred text 2. From the ledger, copy the open accounts (accounts with balances). Ignore or skip the account having ZERO balances. 3. Get the sum of the total debits and credits must be equal, then, double rule their total balance.
Learning Competency with code
Prepare a Trial Balance. ABM_FABM11- IVa-d -32
145 Exercise 1. Journalize, Posting and Preparation of Trial Balance Directions/Instructions: Journalize, post and prepare the Trial Balance of Kris Brenth, CPA for the month of March,2020. The half month of Brenth transaction are listed below. { Journal entries : 2 points each}
Kris Brenth, CPA
Trial Balance March 15,2020 Account Title Debit Credit Cash ₱ 50,000 Accounts Receivable 70,000 Prepaid Rent 10,000 Supplies 6,000 Furniture and Fixture 30,000 Land 350,000 Accounts Payable ₱ 44,000 Villa, Capital 450,000 Villa, Drawings 21,000 Service Revenue 71,000 Salaries Expense 18,000 Rent Expense 7,000 Utilities Expense 3,000
Total ₱ 565,000 ₱ 565,000
During the remainder of March,2020, Brenth completed the following transactions:
March 16 Collected P 40,000.00 cash from a client on account.
17 Performed tax services for a client on account, P12,000 19 Payment of payables to creditor amounted to 10,000 31 Paid employees’ salaries, P 18,000.00 Guide Questions 1. After journalizing, what is the effect of transactions to the trial balance? 2. How much is the total balance of debits and credits of the trial balance?
146 Rubrics for Scoring Trial Balance Criteria NI Fair Good Excellent (5) (10) (15) (20)
Concept Does not Does not Understands Shows clear
understand understand concepts in understanding concepts in concepts in preparing trial of the concepts preparing trial preparing trial balance very in preparing a balance very well balance very well with few trial balance with major errors well with half errors. errors. Structure Heading is Correct heading Correct heading Correct incorrect, Omitted and DOUBLE and DOUBLE heading and DOUBLE RULE RULE the total RULE the total DOUBLE in total balance. balance. Listing balance. Listing RULE the total Most of the listed of accounts of accounts is balance. Listing accounts is entered with 1-2 is not properly entered of accounts is incorrectly and properly with -3-4 properly most of its entered with -3- incorrect entered with amounts are not in 4 incorrect amounts in its correct proper debit and amounts in its debit and credit amounts in its credit column debit and credit column debit and credit column column. Computations Total balance of Total balance Total balance of Total balance debit and credit of debit and debit and credit of debit and columns are credit columns columns are credit columns incorrect due to are incorrect incorrect due to are correct and major errors and due to 3-4 1-2 errors but equal not equal errors and not equal equal
Directions: Please refer to the information below. Journalize and post the transactions to come up with the correct balances. Then prepare the correct Trial Balance.
The Trial balance of Shine Laundry services as of December 31 does not balance because of a number of errors. While comparing the amounts in the trial balance with the ledger, re- computing the balances of the accounts, and comparing the posting with the entries, the errors described below where discovered.
a. The balance of cash was overstated by P 3,000
149 b. A return of P750 of defective laundry supplies were erroneously posted as P 500 credit to laundry supplies
c. The P 30,000 rent expense was erroneously recorded as P 3,000
d. The balance of accounts payable was overstated by 800
Guide Questions 1. What is the proper heading of the above trial balance? 2. After considering the necessary adjustments, how much is the balance of the following affected accounts? a. Cash b. Laundry Supplies c. Rent expense d. Accounts payable e. Drawings 3. How much is the total balance of debits and credits of the trial balance?
Rubrics for Scoring Trial Balance
Criteria NI Fair Good Excellent
(5) (10) (15) (20)
151 Concept Does not Does not Understands Shows clear understand understand concepts in understanding concepts in concepts in preparing trial of the concepts preparing trial preparing trial balance very in preparing a balance very well balance very well with few trial balance with major errors well with half errors. errors. Structure Heading is Correct heading Correct heading Correct incorrect and and DOUBLE and DOUBLE heading and omitted DOUBLE RULE the total RULE the total DOUBLE RULE in total balance. Listing balance. Listing RULE the total balance. Most of of accounts of accounts is balance. Listing the listed accounts with 1-2 is not properly entered of accounts is is entered properly with -3-4 properly incorrectly and entered with -3- incorrect entered with most of its 4 incorrect amounts in its correct amounts are not in amounts in its debit and credit amounts in its proper debit and debit and credit column debit and credit credit column column column. Computations Total balance of Total balance Total balance of Total balance debit and credit of debit and debit and credit of debit and columns are credit columns columns are credit columns incorrect due to are incorrect incorrect due to are correct and major errors and due to 3-4 1-2 errors but equal not equal errors and not equal equal
152 Exercise 3. Preparation of Trial Balance Directions: Using the balances from Ivanna’s ledger. Prepare a trial balance of Ivanna’s Bookkeeping Services for January 2020.
Account Name: Cash
Account No. 101 Balance Re Date Explanation Debit Credit Debit Credit f. 2020 Jan- Capital Investment J1 250,000 250,000 01 2 Purchase of Equipment J1 28000 222,000 4 Payment of 1-year insurance J1 10,000 212,000 Partial payment of purchased on 11 J1 20,000 192,000 Equipment 12 Borrowed cash from the bank J2 105,000 297,000 15 Payment of Supplies on Account J2 10,200 286,800 17 Payment of rent J2 7,000 279,800 18 Payment of salary J2 8,000 271,800 22 Collection of Services account J2 5,000 276,800 23 Received cash from services rendered J2 16,500 293,300 25 Payment of utilities J2 5,200 288,100 28 Withdrawal of cash J2 8,000 280,100 30 Payment of salary J3 8,000 272,100
Account Name: Accounts Receivable
Account No. 102 Balance Date Explanation Ref. Debit Credit Debit Credit 2020 Jan-05 Billed client for services rendered J1 21,000 21,000 10 Billed client for services rendered J1 25,000 46,000 22 Collection of clients account J2 5,000 41,000
Account Name: Office Supplies
Account No. 103 Balance Balance Date Explanation Ref. Debit Credit Debit Credit Purchase of office supplies on Jan-08 J1 10,200 10,200 account
Account Name: Prepaid Insurance
Account No. 104 Balance
153 Date Explanation Ref. Debit Credit Debit Credit 2020 Jan-03 Payment of 1-year insurance J1 15,000 10,000
Account Name: Office Equipment
Account No: 105 Balance Date Explanation Ref. Debit Credit Debit Credit 2020 Purchase of office equipment on Jan-03 J1 28,000 28,000 account Purchase of office equipment on 26 J2 30,000 58,000 account
Account Name: Furniture and Fixture
Account No. 106 Balance Date Explanation Ref. Debit Credit Debit Credit 2020 Jan-03 Purchase of furniture on account J1 50,000 50,000
Account Name: Accounts Payable
Account No. 201 Balance Date Explanation Ref. Debit Credit Debit Credit 2020 Purchase of furniture and Fixture Jan-03 J1 50,000 50,000 on account Purchase of office supplies on 8 J1 10,200 60,200 account Partial payment of Furniture & 11 J1 20,000 40,200 Fixture 15 Full payment to supplier J2 10,200 30,000 Partial payment of Equipment on 26 J2 30,000 60,000 Account
Account Name: Loans Payable
Account No. 203 Balance Date Explanation Ref. Debit Credit Debit Credit 2020 Jan-12 Borrowed cash from the bank J2 105,000 105,000
155 2020 Jun-25 Payment of utility bills J2 5,200 5,200
Guide Questions 1. What is the proper heading of the trial balance above? 2. After extracting the amounts from the ledger to trial balance, how much is the total of debits and credits?
Rubrics for Scoring Trial Balance
Criteria NI Fair Good Excellent
(5) (10) (15) (20)
Concept Does not Does not Understands Shows clear
understand understand concepts in understanding concepts in concepts in preparing trial of the concepts preparing trial preparing trial balance very in preparing a balance very well balance very well with few trial balance with major errors well with half errors. errors. Structure Heading is Correct heading Correct heading Correct incorrect, Omitted and DOUBLE and DOUBLE heading and DOUBLE RULE RULE the total RULE the total DOUBLE in total balance. balance. Listing balance. Listing RULE the total Most of the listed of accounts of accounts is balance. Listing accounts is entered with 1-2 is not properly entered of accounts is incorrectly and properly with -3-4 properly most of its entered with -3- incorrect entered with amounts are not in 4 incorrect amounts in its correct proper debit and amounts in its debit and credit amounts in its credit column debit and credit column debit and credit column column. Computations Total balance of Total balance Total balance of Total balance debit and credit of debit and debit and credit of debit and columns are credit columns columns are credit columns incorrect due to are incorrect incorrect due to are correct and major errors and due to 3-4 1-2 errors but equal not equal equal
156 errors and not equal
Answer Sheet Exercise
157 References: Textbook: Fundamentals of Accountancy, Business, and Management 1. Isabela CPA Review Center Bookkeeping hands out Teacher’s Guide: Fundamentals of Accountancy, Business, and Management 1. Joselito G. Florendo, : Fundamentals of Accountancy, Business and Management 1 Valencia, et.al (2010). Basic Accounting 3rd ed. Valencia Educational Supply Weygandt, J. et .al (20120. Accounting Principles 10th ed. John Wiley & Sons (Asia) Pte. Ltd.
Closure: In this activity, I learned that in the preparation of trial balance_________________
Exercise 1 Journal entries for the remaining days of March , 2020 Mar- 16 Cash ₱ 40,000 Accounts Receivable ₱ 40,000 To record collection of Accounts Receivable
17 Accounts Receivable 12,000.00
Services Revenue 12,000.00 To record services rendered on account
19 Accounts Payable 10,000.00
Cash 10,000.00 To record payment of Accounts payable
31 Salaries expense 18,000.00
Cash 18,000.00 To record payment of salaries to employees
Kris Brenth, CPA
Trial Balance March 31,2020 Account Title Debit Credit Cash ₱ 62,000 Accounts Receivable 42,000 Prepaid Rent 10,000 Supplies 6,000 Furniture and Fixture 30,000 Land 350,000 Accounts Payable 34,000 Villa, Capital ₱ 450,000 Villa, Drawings 21,000 Service Revenue 83,000 Salaries Expense 36,000 Rent Expense 7,000 Utilities Expense 3,000 Total ₱ 567,000 ₱ 567,000
