PROBLEM 1: The following is the adjusted trial balance of Water World Store at the end of 2020:

Account Titles	Adjusted (thousand		Trial Balance omitted)
	Debit	Credit
Cash	20,025
Accounts Receivable	14,000
Allowance for Bad Debts		2,000
Supplies	500
Merchandise Inventory, Jan 1	25,300
Prepaid Interest	500
Prepaid Rent	4,267
Store Equipment	15,000
Accumulated Depreciation		2,500
Accounts Payable		7,500
Salaries Payable		450
Utilities Payable		2,520
Loans Payable		10,000
Laurel, Capital		67,625
Laurel, Personal	3,500
Sales		91,500
Sales Discount	1,800
Purchases	70,000
Purchase Discounts		1,880
Bad Debts	500
Depreciation Expense	1,000
Supplies Expense	1,400
Salaries	12,050
Utilities	7,500
Rent Expense	8,533
Interest Expense	100	______
Totals	185,975	185,975

Consider the following when preparing the computations:

1. Merchandise inventory end P27,500 is deducted from available for sale in the income statement and presented as a current asset in the statement of financial position.
2. Depreciation is a distribution expense.
3. Utilities of P2,500 is an administrative expense
4. P4,050 of the salaries is a distribution expense
5. P3,000 of rent expense is an administrative expense.
6. P400 of supplies is a distribution expense
7. Owners equity is affected by Laurel, Capital, Laurel, Personal and net income (or net loss)

PREPARE A SCHEDULE FOR EACH OF THE FOLLOWING

1. Net sales.
2. Cost Of Sales
3. Distribution Expenses
4. Administrative Expenses
5. Net Income
6. Current Assets
7. Non Current Assets
8. Current Liabilities
9. Non Current Liabilities
10. Owners Equity

Owners Equity is a title used for a sole proprietor owned business. In a partnership, the title is Partners Equity and the computation is the same except that there is a plurality of capital and drawing accounts since there are two or more partners:

Santos Cruz Total

Capital Beg Pxx Pxx Pxx

Add profit share xx xx xx

Less Drawings (xx) (xx) (xx)

Capital, End Pxx Pxx Pxx

For a corporation, the title is Stockholders Equity with two principal accounts:

Share Capital Stock (for investments of shareholders) Pxx

Retained Earnings (accumulated earnings less losses and dividends) xx