The May 31, 2013 trial balance for Lucena Bacalso Surveyors is presented as follows:

Lucerna Bacalso Surveyors

Trial Balance

May 31, 2013

Cash P 210,000

Accounts Receivable 930,000

Prepaid Advertising 360,000

Engineering Supplies 270,000

Survey Equipment 1,890,000

Accum. Depreciation-Survey Equipment P 640,000

Accounts Payable 190,000

Unearned Survey Revenues 120,000

Notes Payable 500,000

Bacalso, Capital 1,120,000

Bacalso, Withdrawals 700,000

Survey Revenues 6,510,000

Salaries Expense 3,270,000

Rent Expense 960,000

Insurance Expense 250,000

Utilities Expense 160,000

Miscellaneous Expense 80,000

Totals P 9,080,000 P 9,080,000

The following information pertaining to the year-end adjustments is available:

• The P360,000 prepaid advertising represents expenditure made on Nov. 1, 2012 for monthly advertising over the next 18 months.
• A count of the engineering supplies at May 31, 2013 amounted to P90,000.
• Depreciation on the surveying equipment amounted to P160,000.
• One-third of the unearned survey revenues has been earned at year-end.
• At year-end, salaries in the amount of P140,000 have accrued.
• Interest of P60,000 on the notes payable has accrued at year-end.

Required: Prepare the adjustments and financial statements.