ACCOUNTING EXERECISES

Brando & Diego Store provided the following data obtained from the single entry records for the current year. January 1 December 31 Cash 750,000 900,000 Notes receivable 150,000 500,000 Accounts receivable 700,000 900,000 Merchandise Inventory 700,000 550,000 Equipment 600,000 550,000 Accrued income 250,000 400,000 Notes payable 300,000 200,000 Accounts payable 700,000 600,000 Unearned rent income 40,000 55,000 The cash book showed the following information Balance, January 1 750,000 Receipts: Accounts Receivable 1,400,000 Notes receivable 400,000 Cash sales 400,000 Proceed from note receivable discounted with face 200,000 value of 250,000 Rent income 80,000 Sale of equipment costing 200,000 with carrying 150,000 amount of 70,000 Additional investment 100,000 2,730,000 Total 3,480,000 Payments Notes payable 500,000 Accounts payable 1,000,000 Cash purchases 850,000 Equipment 50,000 Withdrawals 130,000 Expenses 50,000 2,580,000 Balance, December 31 900,000 Other information: Sales returns made by customers 150,000 Accounts receivable written off 40,000 Purchase discounts on accounts payable paid 30,000 1. Compute for the Net Income using the capital approach. 2. Compute for the following (accrual basis): ' . Gross Sales . Gross Purchases . Rent Income . Depreciation Expense 3. Prepare traditional income statement