Accounting Equation Example
Accounting Equation Example
Accounting Equation Example
July 1 - Paolo Reyes started a delivery service on July 1, 2013. The following transactions occurred
during the month of July. He invested PHP800,000 cash and Cars amounting to PHP200,000
July 2 – Reyes borrowed PHP100,000 cash from PNB for use in his business.
Asset purchased for cash
July 7 – Bought tables and chairs from Orocan and paid PHP45,000 cash
July 15 – Various equipment were purchased on account from Fortune for PHP55,000
Cash withdrawal by the owner
Payment of liability
(1) matching;
(2) systematic allocation, or;
(3) direct association.
July 21 – A customer hired the services of Reyes. Cash of PHP15,000 was received from the customers.
July 22 – Cash was paid for the following : gas and oil, PHP500 and car repairs, PHP1,000.
Revenue rendered on account
July 24 – Another customer hired the services of Reyes and promised to pay PHP16,000 on July 31.
July 27 – Another customer hired the services of Reyes. A bill was issued to them for PHP20,000, 50% of
which was collected
July 31 – Paid PHP10,000 for rental of office space, and salaries of PHP9,000
ACTIVITY TIME
1. The owner invested cash of PHP150,000 or the business earned PHP150,000 cash from providing
services.
3. The owner withdrew cash of PHP112,500 or the business incurred PHP112,500 expenses and paid in
cash.
5. The owner withdrew cash of PHP15,000 or the business incurred PHP15,000 expenses and paid in cash.
7. The owner withdrew supplies worth PHP8,000 or the business used supplies worth PHP8,000.