Fundamental Accounting 2

Requirements: 1. Journalize the following transactions. 1 point each 2. Prepare an income statement assuming that stock on hand amounted to P195,000. A 3% percentage tax should be set-up based on net sales. Determine the profitability of the company. Banks prime rate of return is 6% on investments. 20 points

Problem Solving The data for August are given below for Pretty Carpets. The company honors BDO Express Car for a 3% service fee. Journalize in a 2-column journal and post to customer's and supplier's subsidiary ledger cards. The company is non-VAT registered. 1 - Pretty Carpets of Cebu was organized with the owner Vic Feria investing P550,000 cash and P100,000 worth of merchandise. P300,000 was immediately deposited with BDO. 3- Carpets were purchased for P135,000 including freight of P2,500. Issued a check for this. 10 - Sold merchandise to Rustan's of Manila, P92,000. Terms: 2/10, n/30. 12 The company sold goods on account to Robinson's Cebu, P72,000 2/EOM, n/30. 16 - P2,900 worth of goods were returned by Rustan's for credit. 20 - Salaries paid: office employees, P9,500 and salesmen P26,000 less 5% withholding tax. 22 - Collected in full the account of Rustan's. 24 - The Company returned merchandise purchased on June 3 and was given a cash refund of P8,000. 26 - Purchased goods from Bess Carpets, P105,000. Terms: 2/10, n/30, FOB Shipping Point 27 - Paid freight of P3,000 on the Bess shipment. 28 - Robinson's paid its account in full. 28 - Paid Bess Carpet, P55,000. 29 - Cash sales, P54,000 including P14,000 on credit cards. Cash deposited with BDO. 30 - Issued a check for store rent P15,000. BDO's bank statement showed the bank charge of 3% for the month. Assumed the bank charge based on the issued check. 31 - Paid for salaries less withholding tax. Additional deductions were made for 3% SSS, 1.5% PhilHealth and 2% Pag-ibig Premiums. Paid in cash utilities, P6,000 (one-fourth is considered administrative). Problem Solving The data for August are given below for Pretty Carpets. The company honors BDO Express Car for a 3% service fee. Journalize in a 2-column journal and post to customer's and supplier's subsidiary ledger cards. The company is non-VAT registered. 1 - Pretty Carpets of Cebu was organized with the owner Vic Feria investing P550,000 cash and P100,000 worth of merchandise. P300,000 was immediately deposited with BDO. 3- Carpets were purchased for P135,000 including freight of P2,500. Issued a check for this. 10 - Sold merchandise to Rustan's of Manila, P92,000. Terms: 2/10, n/30. 12 The company sold goods on account to Robinson's Cebu, P72,000 2/EOM, n/30. 16 - P2,900 worth of goods were returned by Rustan's for credit. 20 - Salaries paid: office employees, P9,500 and salesmen P26,000 less 5% withholding tax. 22 - Collected in full the account of Rustan's. 24 - The Company returned merchandise purchased on June 3 and was given a cash refund of P8,000. 26 - Purchased goods from Bess Carpets, P105,000. Terms: 2/10, n/30, FOB Shipping Point 27 - Paid freight of P3,000 on the Bess shipment. 28 - Robinson's paid its account in full. 28 - Paid Bess Carpet, P55,000. 29 - Cash sales, P54,000 including P14,000 on credit cards. Cash deposited with BDO. 30 - Issued a check for store rent P15,000. BDO's bank statement showed the bank charge of 3% for the month. Assumed the bank charge based on the issued check. 31 - Paid for salaries less withholding tax. Additional deductions were made for 3% SSS, 1.5% PhilHealth and 2% Pag-ibig Premiums. Paid in cash utilities, P6,000 (one-fourth is considered administrative)