Sie sind auf Seite 1von 2

Sole Proprietorship

You were given the following transactions for XYZ Massage Parlor:

January 1 Miss X, the owner, made the following investments: cash (P100,000), building (cost=P435,000,
market value=P250,000, useful life=10 years, residual value=20,000) and land (historical cost=P450,000,
current value=P600,000, carrying amount=P500,000).

January 10 Purchased massage equipment worth P125,000. Estimated useful life is 5 years. Terms: 20%
down payment, 12% note for the balance payable in five months. XYZ laid out P2,000 for freight and
P3,000 for special handling.

January 12 Purchased massage supplies for cash, P20,000.

January 15 The company charges P500 per massage hour. Total massage hours rendered for the day was
20 hours. All were for cash except for 5 hours which were related to promotions (the clients were
massaged for free). Supplies worth P2,000 were consumed.

January 16 Massage hours rendered for the day is 20. Of these, 10 hours were rendered to favored clients
(who paid in cash) so that the price was set at 10% lower than the regular price. The rest were service
rendered on account.

January 17 Received electricity bill, P1,500.

January 18 Rendered massage service to Miss X for 2 hours. Miss X intends to pay for it next month.

January 19 Salaries for January 1 to 15 is P10,000. Of these, 80% was actually paid to employees. The
balance represented withholding tax. The company is obliged to remit withholding tax to the BIR in April.

January 20 Massage hours rendered is 15 hours. All were collected in cash.

January 21 A supply count was conducted due to suspicions of employee theft. This was immediately
disproved after the count. Massage supplies cost equaled stock card balance of P5,000.

January 25 Collected half of the receivable from January 16. A 5% discount was given.

January 26 Miss X paid half of her January 18 account. She said she won’t refund the other half.

January 27 Paid business taxes of P1,200. Also, massage hours for the day was 25 hours (half in cash, half
on credit).

January 28 A client from January 20 went back and complained about back pains. As a consequence, he
demanded that he be refunded ½ of what he paid in exchange for not reporting the matter to the
authorities.

January 30 The company decided to increase its charge by 20%. Massage hours for the day was 12 hours,
all charged at the new price. All were on cash basis.

Comprehensive Problem – Sole Proprietorship


DNLEE_1718
Required:

Prepare the pro forma journal entry for each of the transactions above. In addition, and if necessary,
prepare a single compound adjusting entry. Use the nearest-month rule for adjustments. Round off final
answers to the nearest two decimal places.

Comprehensive Problem – Sole Proprietorship


DNLEE_1718