he audit of Anne Company for the year ended December 31,

2017 was completed on March 1, 2018.

The financial statements were signed by the managing director

an March 15, 2018 and approved by the shareholders on March

31, 2018.

The following events have occurred:

1. On January 15, 2018, a customer owing P900,000 to Anne

filed for bankruptcy.

The financial statements include an allowance for doubtful

accounts pertaining to this customer only of P100,000.

2 The entity's issued share capital comprised 100,000 ordinary

shares with P100 par value.

The entity issued additional 25,000 shares on March 1, 2018

at par value.

3. Specialized equipment with carrying amount of P525,000

was destroyed by fire on December 15, 2017.

The entity has booked a

receivable of P400,000 from the

insurance entity.

After the insurance entity completed the investigation

on

February 1, 2018, it was discovered that the

fire took place

due to negligence of the machine operator.

As a result, the insurer's liability was zero on the claim.

Required:

repare

adjusting entries on December 31, 2017 for the event