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Basic Accounting Exercise

The document provides a list of 15 financial transactions conducted by Mr. Bean, a certified public accountant, for his new business in the month of August, including depositing start-up money, paying expenses, purchasing equipment, rendering and receiving payment for accounting services, and withdrawing cash for personal use. It requires the transactions to be journalized, posted to T-accounts, and a trial balance to be prepared.

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albert_malquisto
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115 views

Basic Accounting Exercise

The document provides a list of 15 financial transactions conducted by Mr. Bean, a certified public accountant, for his new business in the month of August, including depositing start-up money, paying expenses, purchasing equipment, rendering and receiving payment for accounting services, and withdrawing cash for personal use. It requires the transactions to be journalized, posted to T-accounts, and a trial balance to be prepared.

Uploaded by

albert_malquisto
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Basic Accounting

Mr. Bean, a Certified Public Accountant, opened an office on August 1 of the current year. During the
month, he completed the following transactions connected with his professional practice:

1. Mr. Bean deposited P 500,000 in the company’s bank account.


2. Paid August rent for office and workroom, P 2,500
3. Purchased computer equipments for P 60,000, paying P 30,000 cash and giving an interest-bearing
note for the remainder.
4. Paid cash for office supplies (expense), P 500.
5. Paid cash for insurance policies, P 1,000
6. Rendered accounting services to clients on account, P 50,000
7. Paid cash for miscellaneous services, P 120
8. Rendered services to client for P 35,000. The client made a down payment of P 5,000 and gave a non-
interest bearing note for the balance.
9. Received cash for services rendered, P 15,000
10. Paid installment due on note payable, P 5,000
11. Paid salary of assistant, P 10,000
12. Fees earned and billed to customers for the month, P 25,000
13. Paid repairs on computer equipments for August, P 500
14. Mr. Bean withdrew cash from the business for personal use, P 5,000
15. Purchased office supplies (expense) on credit, P 1,500

Requirements:

a) Journalize the foregoing transactions.


b) Post the transactions journalized above in the following T-accounts:
101 Cash 401 Professional Fees
102 Accounts receivable
103 Notes receivable 501 Rent expense
104 Computer equipment 502 Office Supplies Expense
503 Insurance Expense
201 Accounts payable 504 Miscellaneous Expense
202 Notes payable 505 Salaries expense
506 Repairs and Maintenance
301 Mr. Bean, Capital
302 Mr. Bean, Drawing

c) Prepare a trial balance for Mr. Bean, CPA, as of August 31 of the current year.

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