Requirements: provide journal entries and complete the working profit and loss table

subject/course: accounting

Juliet Company was incorporated 3 years ago as a trading company engaged in the sale and distribution of hardware and electrical supplies. You were given by the Controller, MS. Maine, a copy of the unadjusted trial balance as of December 31, 2017. The company maintains bank accounts with BDO and MBTC. Your review of the bank reconciliation statements submitted to you by MS. Maine disclosed the following information: 1. On December 22, 2017, the bank erroneously debited the account of Juliet Company for P200,000 representing withdrawals for the account of another company. 2. A check received by the company from a client on Dec. 23, 2017 for P40,000 dated Jan. 3, 2018 was included in the deposit in transit. The check was actually deposited on Jan. 3, 2018 with no problem. 3. On December 28, 2017, the company issues check to suppliers totaling P120,000. The check was released on January 5, 2018. Based on your examination, the said check was not recorded in the company's book. 4. A check dated Dec. 21, 2017 in payment of accounts payable was recorded as P12,000. Upon your examination of the check returned by the bank, the actual amount was P21,000. 5. A check for P34,000 in payment of a computer set was recorded in the company's book as repairs and maintenance. 6. Transfer of fund of P59,000 to MBTC account of Abacus Securities was not recorded. This pertains to the purchase of 5,000 shares of Joel Corporation. Based on the quoted price as of December 31, 2017, the market value per share is P9.00. 7. Interest earned amounting to P6,500 was not recorded. The petty cash fund of P40,00 maintained on an imprest basis was counted on January 3, 2018. Unreplenished expenses included petty cash vouchers for various expenses totaling P23,000 all dated December 31, 2017 and employees' advances for P6,000 dated Jan. 2, 2016. An examination of the customers' account shows that account totaling P6,000 should be written off as uncollectible. In addition, it has been the policy of the company to set up an allowance account equivalent to 3% of the accounts receivable at the end of the period. Juliet Company was in possession of merchandise on consignment basis from various suppliers as of December 31, 2016. The P100,000 worth of merchandise was included in the ending inventory of 2016. The said consigned merchandise was also recorded as purchases in 2016. Juliet Company shipped on December 24, 2016 : merchandise on terms FOB shipping Point. The merchandise was sold for P60,000 and it arrived January 28, 2017. The merchandise cost P40,000, the sale then being recorded in January 2017 and included in the 2016 inventory as well. Merchandise ordered December 26, 2017 costing P120,000 was shipped to Juliet Company on December 30 on terms FOB destination. The invoice was received December 30 and purchase was recorded. However, the goods were not part of the December 31, 2017 physical count since it arrived only January 6, 2018. The securities' custodian provided you with the details of the current portfolio of Juliet Company's marketable securities account as of December 31, 2017: No. of Shares Cost Market Value NRCP ordinary share 2,000 P150,000 P59 50 per share Now shares 2,000 110,000 48.50 per share NGCP shares 5,000 90,000 12.50 per shareYour physical count of stock certificates disclosed that stock dividends of the following issues were not yet recorded in the books: Issue No. of Shares Now shares 700 NGCP shares 400 All of the above securities are actively traded in the stock exchanges. The Notes Receivable in the amount of P200,000 was received from a major customer. It was : 90-day, 12's note dated November 3, 2017. No interest has been accrued on the note as of December 31, 2017. Prepayments in the amount of P400,000 is broken down into Prepaid Insurance of P100,000, Office Supplies Unused of P75,000 and Advance Rental and Deposit on Lease of P225,000. In the year 2017, Juliet Company purchased two insurance coverages, one for four (4) motor vehicles and the other one to cover the cost of the inventory against fire. The face value of the motor policy is P1.5 Million while that of the inventory is P4.5 Million. The coverage for both is a period of one year counting from the date the policy premium was paid for. The motor policy was taken August 1, 2017 for the premium of P25,000 while that of the inventory was taken last October 31, 2017 for a premium of P75,000- To be able to save on transportation costs, the purchasing manager of Juliet Company sees to it that office supplies are bought not from the regular bookstores but from the retailers of the same located in the City. They realized that this arrangement could lead to savings of around 30%. You asked for an inventory of the supplies as of December 31, 2017, and found out that P29,000 were still unused at year-end. In the year 2017, the company renewed the lease contract, this time for 3 years with Davao Development, Inc., subject to renewal every 3 years with a priority right to buy the property in case the owner decided to sell later on. A deposit equivalent to three months rental and advance rental for a year was given and the rest in the form of postdated checks to cover the rental for the last two years of the lease contract. Despite a quite stiff arrangement, management of Juliet Company agreed due to the intensified development in the area requiring use of merchandise extensively as well as the store being located right in the heart of the commercial center in the Davao City area. The lease contract states a monthly rental of P15,000, and became effective July 31, 2017. The building under lease was renovated at a cost of P400,000 which was booked as leasehold improvements on September 1, 2017. These improvements will be amortized for 5 years. No amortization was recorded as at December 31, 2017. on May 1, 2017, the company bought new equipment for the use in the plant totaling P400,000. In addition to the cost, it paid additional charges, which were taken up as repairs expenses. These are delivery charges - P15,000; installation cost P20,000; and testing costs - P7,500. The estimated useful life of these equipment is 4 years. No depreciation was provided on the equipment as of December 31, 2017. Juliet Company opened additional store in a nearby localities. To service more deliveries, additional 3 units of delivery equipment were bought on installment basis on December 29, 2017. The installment price was P1,200,00 but the cash price was P1,000,000. The terms are P200,000 down payment and the balance payable in four equal quarterly installments. A non-interest bearing promissory note was issued for the unpaid portion on December 31, 2017. The down payment of P200,000 was recorded as debit to Delivery Equipment and a credit to Cash. Accounts payable - trade includes cash advances from the President totaling P300,000 which was used to augment working capital requirement. It also includes some accrued expenses set-up by the accountant at year-end amounting to P40,000. You reviewed subsequent payments made in January 2018 which included the following: Electric bills for December 2017 P25,000 Telephone bills for January 2018 12,000 Water for Nov. and Dec. 2017 1,500 Minor repairs of a vehicle done in Dec. 2017 10,000Juliet Company was paid a total of P100,000 by a handful of clients who took advantage of the recently launched maintenance scheme of the company by giving free maintenance parts and services for a period of one year by just paying an annual retainer amounting to P5,090. The amount of P100,000 was received September 1, 2017 and was initially recorded as Accounts Payable. JULIET COMPANY December 31, 2017 I WORKING PROFIT AND LOSS PER BOOK ADJUSTMENTS PER AUDIT SALES P 6,375,000 COST OF GOODS SOLD 3.825,DO0 GROSS PROFIT P 2,550,000 OPERATING EXPENSES 740.DO0 INCOME FROM OPERATIONS P 1,810,000 OTHER INCOME 500,000 OTHER CHARGES 100.D00 INCOME BEFORE TAXES P 2,210,000 PROVISION FOR INCOME TAX 563,D00 NET INCOME P 1,547,000 RETAINED EARNINGS - BEG 162,800 PRIOR PERIOD ADJUSTMENTS 0 DIVIDENDS (500,0DO) RETAINED EARNINGS - END P 1,209 800 BALANCE SHEET CASH P 627,000 PETTY CASH FUND 40,D00 MARKETABLE SECURITIES 350,000 ACCOUNTS RECEIVABLE 564 500 ALLOW. FOR DOUBTFUL (82,0DO) ACCOUNT NOTES RECEIVABLE 200,000 INTEREST RECEIVABLE 0 INVENTORIES 689 000 PREPAYMENTS 400,D00 PROPERTY, PLANT AND 3,250,000 EQUIPMENT ACCUM. DEPRECIATION (1,200,000) OTHER ASSETS 145,000 TOTAL ASSETS P 5,183 500 ACCOUNTS PAYABLE P 950,000 NOTES PAYABE 0 DISCOUNT ON NOTES PAYABLE 0 ACCRUED EXPENSES INCOME TAX PAYABLE 50,000 OTHER LIABILITIES 43,700 BONDS PAYABLE 1,000,000 DISCOUNT ON BONDS PAYABLE 120,000) ORDINARY SHARES 2,000,000 SHARE PREMIUMS 50,D00 RETAINED EARNINGS 1,209 800 TOTAL LIAB. AND SHAREHOLDERS' EQUITY P 5.183,500