Exercise 3Requirement a Josie Tan Enterprises Balance Sheet January 2, 2007 Cash P30,000 Owner’s Equity: J... Requirement dJosie Tan Enterprises Balance Sheet January 2, 2007 Cash P30,00
Trang 1Introduction: Accounting and Its Environment
Exercises
Exercise 1
1 b
2 a
3 a
4 c
5 b
6 b
7 c
8 c
Exercise 2
1 b
2 d
3 a
4 d
5 a
6 c
7 b
8 e
9 e
10 b
11 c
12 c
3-1
Trang 2Exercise 3
Requirement (a)
Josie Tan Enterprises Balance Sheet January 2, 2007
Cash P30,000 Owner’s Equity:
J Tan, Capital P30,000 Total assets P30,000 Total liabilities and
owner’s equity P30,000 Requirement (b)
Josie Tan Enterprises Balance Sheet January 2, 2007
Cash P30,000 Owner’s Equity:
J Tan, Capital P20,000 Total assets P30,000 E Tan, Capital 10,000
Total owner’s equity P30,000 Total liabilities and
owner’s equity P30,000 Requirement (c)
Josie Tan Enterprises Balance Sheet January 2, 2007
Cash P30,000 Owner’s Equity:
Ordinary share capital P 6,000 Total assets P30,000 Additional paid-in capital 24,000
Total owner’s equity P30,000 Total liabilities and
owner’s equity P30,000
Trang 3Requirement (d)
Josie Tan Enterprises Balance Sheet January 2, 2007
Cash P30,000 Owner’s Equity:
Ordinary share capital P30,000 Total assets P30,000 Total liabilities and
owner’s equity P30,000
Exercise 4
Requirement (a)
Jaycee and Company Income Statement (Single-Step) For the Year Ending December 31, 2007 Revenues:
Expenses:
Requirement (b)
4-3
Trang 4Jaycee and Company Income Statement (MultiStep) For the Year Ending December 31, 2007
Less:
Operating Expenses:
Other Revenues:
Other Expenses:
Exercise 5
Requirement (a)
Canada Company Statement of Capital For the Year Ending December 31, 2007
Requirement (b)
Trang 5Canada Company Statement of Capital For the Year Ending December 31, 2007 Canada, Capital, January 3, 2007 P50,000
Sibal, Capital, January 3, 2007 P30,000
Tan, Capital, January 3, 2007 P20,000
Total Owner’s Equity, December 31, 2007 P175,000 Requirement (c)
Canada Company Statement of Shareholders’ Equity For the Year Ending December 31, 2007
Ordinary Shares
Additional Paid-in Capital
Retained Earnings
Total Shareholders’ Equity Balance, Jan 3 P20,000 P80,000 P 0 P100,000 Net Income
75,000 75,000 Balance, Dec 31 P20,000 P80,000 P75,000 P175,000
Exercise 6
Requirement (a)
Canada Company Statement of Capital For the Year Ending December 31, 2008
P295,000
4-5
Trang 6Canada, Capital, December 31, 2008 P215,000 Requirement (b)
Canada Company Statement of Capital For the Year Ending December 31, 2008 Canada, Capital, January 1, 2008 P 87,500
P147,500
Sibal, Capital, January 1, 2008 P 52,500
P 88,500
Tan, Capital, January 1, 2008 P 35,000
P 59,000
Total Owner’s Equity, December 31, 2007 P215,000 Requirement (c)
Canada Company Statement of Shareholders’ Equity For the Year Ending December 31, 2007
Ordinary Shares
Additional Paid-in Capital RetainedEarnings
Total Shareholders’ Equity Balance, Jan 1 P20,000 P80,000 P 75,000 P175,000
Dividends
(80,000) (80,000) Balance, Dec 31 P20,000 P80,000 P115,000 P215,000
Trang 7Requirement (d)
Canada Company Statement of Retained Earnings For the Year Ending December 31, 2008
P195,000
Exercise 7
a Rainee Ingrid Company is a sole proprietorship This can be determined by examining the statement of capital or the balance sheet Absence of retained earnings or stock accounts eliminates the possibility that the company is a corporation Since there is only one capital account, the company can’t be a partnership The single capital account suggests that Rainee Ingrid is the sole owner of a sole proprietorship
b Rainee Ingrid uses a multistep income statement format This is demonstrated by the calculation of a gross margin for the company The multistep format highlights the relationship between sales revenue and cost
of goods sold, thus arriving at gross margin From gross margin, all operating expenses are deducted, resulting in operating income, another item not found on a single-step income statement In a multistep format, other revenues and expenses are shown below operating income
c Articulation is the link among the income statement, the statement of owners’ equity, and the balance sheet Specifically, there is a relationship between net income (or loss) on the income statement and the amount of earned equity on the balance sheet The statement of owners’ equity acts as a bridge statement between the income statement and the balance sheet
In the case of Rainee Ingrid Company, the P74,510 net income amount shown on the income statement can also be found on the company’s statement of capital The ending balance on the statement of capital was derived by adding net income for 2007 (P74,510) to the January 1, 2007 capital balance (P338,060) and subtracting the owner’s drawings for the year (P90,000) The ending balance in the capital account (P322,570), shown on the statement of capital, can also be found on the company’s balance sheet
4-7
Trang 8Exercise 8
Requirement (a)
Nico Francis and Company Income Statement (Single-Step) For the Year Ending December 31, 2007 Revenues:
Expenses:
Requirement (b)
Nico Francis and Company Income Statement (MultiStep) For the Year Ending December 31, 2007
Less:
Operating Expenses:
Other Revenues:
Trang 9Test Material
Test Material 4-1
Clarisse Enterprises Income Statement For the Year Ended December 31, 2007 Revenues:
Expenses:
Clarisse Enterprises Statement of Owner’s Equity For the Year Ended December 31, 2007
Clarisse Enterprises Balance Sheet December 31, 2007
Cash P 31,000 Accounts Payable P 24,000 Accounts Receivable 3,000 Notes Payable 30,000
Buildings 260,000 K Clarisse, Capital 442,000
Total Liabilities and Total Assets P496,000 Owner’s Equity P496,000
4-9
Trang 10Test Material 4-2
Andres Enterprises Income Statement For the Month Ended May 31, 2007 Revenues:
Expenses:
Andres Enterprises Statement of Owner’s Equity For the Month Ended May 31, 2007
Andres Enterprises Balance Sheet May 31, 2007
Cash P156,000 Accounts Payable P 31,000 Accounts Receivable 14,000 Notes Payable 33,000
Buildings 230,000 F Andres, Capital 490,000
Total Liabilities and Total Assets P554,000 Owner’s Equity P554,000