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    Group Activity 1 Aec 217

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    Enitsuj Eam Eugarbal
    Zamboanga Company made several adjusting entries on December 31, 2019 to properly record transactions. These included recording accounts receivable from 2018 that were collected in 2019, recording accounts receivable and payable from 2019, accruing expenses from 2019, and adjusting beginning inventory. An income statement was prepared showing net income of $409,000 for 2019. The statement of financial position showed total assets of $3,905,000 including current assets of $2,035,000 and total liabilities and equity of $3,905,000.

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    Group Activity 1 Aec 217

    Uploaded by

    Enitsuj Eam Eugarbal
    29 views5 pages
    Zamboanga Company made several adjusting entries on December 31, 2019 to properly record transactions. These included recording accounts receivable from 2018 that were collected in 2019, recording accounts receivable and payable from 2019, accruing expenses from 2019, and adjusting beginning inventory. An income statement was prepared showing net income of $409,000 for 2019. The statement of financial position showed total assets of $3,905,000 including current assets of $2,035,000 and total liabilities and equity of $3,905,000.

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    GROUP ACTIVITY 1 AEC 217

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    Zamboanga Company made several adjusting entries on December 31, 2019 to properly record transactions. These included recording accounts receivable from 2018 that were collected in 2019, recording accounts receivable and payable from 2019, accruing expenses from 2019, and adjusting beginning inventory. An income statement was prepared showing net income of $409,000 for 2019. The statement of financial position showed total assets of $3,905,000 including current assets of $2,035,000 and total liabilities and equity of $3,905,000.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    29 views5 pages

    Group Activity 1 Aec 217

    Uploaded by

    Enitsuj Eam Eugarbal
    Zamboanga Company made several adjusting entries on December 31, 2019 to properly record transactions. These included recording accounts receivable from 2018 that were collected in 2019, recording accounts receivable and payable from 2019, accruing expenses from 2019, and adjusting beginning inventory. An income statement was prepared showing net income of $409,000 for 2019. The statement of financial position showed total assets of $3,905,000 including current assets of $2,035,000 and total liabilities and equity of $3,905,000.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 5

    GROUP ACTIVITY 1

    Cash and Accrual Basis


    (Group 5)
    Problem 1: Zamboanga Company
    Required:

    1. Prepare adjusting entries on December 31, 2019.


    2. Prepare an income statement for the year ended December 31, 2019.
    3. Prepare a statement of financial position on December 31, 2019

    Req. 1 Adjusting Entries


    Adjusting Entries- December 31, 2019

    1. Sales 200,000

    Retained Earnings 200,000

    -to record the unrecorded Accounts Receivable on December 2018 that are
    collected in 2019 and credited to sales

    Accounts Receivable 250,000

    Sales 250,000

    -to record the unrecorded accounts receivable in December 2019.

    2. Retained Earnings 40,000

    Sales 40,000

    -to record the customer deposit erroneously credited to sales.

    3. Retained Earnings 350,000

    Purchases 350,000

    -to record the unrecorded accounts payable on December 2018 paid and
    debited to purchases

    Purchases 280,000

    Accounts Payable 280,000

    -to record the unrecorded AP on December 2019.

    4. Expenses 100,000

    Accrued Expenses 100,000

    -accrued expenses on December 31, 2019

    Retained earnings 70,000

    Expenses 70,000

    - to record the unrecorded accrued expenses on December 31, 2018 paid in


    2019 and charged to expenses

    5. Merchandise Inventory- December 31 210,000

    Income Summary 210,000

    -to record the unrecorded inventory on December 31, 2019

    Merchandise Inventory -January 1 150,000

    Retained Earnings 150,000

    -to record the unrecorded inventory on December 2018


    Req. 2 : Income Statement

    Zamboanga
    Company
    Income Statement
    December 31, 2019

    Sales 4,090,000
    Cost of goods sold
    Beggining Inventory 150,000
    Purchases 1,830,000
    Goods Available for sale 1,980,000
    Less: Ending inventory 210,000 1,770,000
    Gross Profit 2,320,000
    Operating Expenses
    Expenses 1,530,000
    Doubtful Account 25,000
    Depreciation 320,000
    Interest Expense 36,000 1,911,000
    Net Income 409,000

    Req. 3: Balance Sheet

    Zomboanga Company
    Statement of Financial Position
    December 31, 2019

    Assets

    Current Assets

    Cash 1,500,000
    Accounts Receivable 250,000

    Allowance for doubtful Account 25,000 225,000

    Merchandise Inventory 210,000

    Advances paid to supplier 100,000

    Total Current Assets 2,035,000

    Noncurrent Asset

    Land 800,000

    Building 1,500,000

    Accumulated Depreciation 600,000 900,000

    Equipment 200,000

    Accumulated Depreciation 30,000 170,000

    Total Noncurrent Asset 1,870,000

    Total Asset 3,905,000

    Liabilities and Equity

    Current Liabilities

    Accounts Payable 280,000

    Accrued Expenses 100,000

    Accrued Interest Payable 36,000

    Total Current liabilities 416,000

    Noncurrent Liabiliities

    Mortgage Payable 900,000

    Total Liabilities 1,316,000

    Shareholder's Equity

    Share Capital 2,000,000

    Retained Earnings 589,000

    Total Equity 2,589,000

    Total Liabilities and equity 3,905,000


    Adjusted Retained Earnings- January 1 180,000

    Net Income 409,000

    Retained Earnings- December 31, 2019 589,000

    Problem 2
    “Evelyn Company”
    Required:
    a. Prepare adjusting entries on December 31, 2019.
    b. Prepare an income statement.
    c. Prepare a statement of financial position.

    Req. a) Adjusting Entries

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