PROBLEM SOLVING:
PERIODIC INVENTORY METHOD
The following are the CHART OF ACCOUNTS for Journalizing, Posting, Trial Balance,
Closing Entries and Post-Closing Trial Balance of JAGIYA General Merchandise
Code Account Title Code Account Title
10 Cash 61 Sales Discount
11 Account Receivable 62 Sales Returns
12 Notes Receivable 70 Cost of Goods Sold
13 Merchandise Inventory 71 Purchases
20 Office Equipment 72 Freight In
21 Furniture and Fixtures 73 Purchase Discounts
30 Accounts Payable 74 Purchase Returns & Allowances
50 Jagiya, Capital 75 Freight Out
51 Jagiya, Drawing 76 Salaries
52 Income Summary 77 Utilities Expense
60 Sales 78 Advertising
79 Office Supplies Used
Use the following CHART OF ACCOUNTS for Financial Statement Separation
Code Account Title Code Account Title
10 Cash and Cash Equivalents 61 Sales Discount
11 Account Receivable 62 Sales Returns
12 Notes Receivable 70 Cost of Goods Sold
13 Merchandise Inventory 71 Purchases
20 Office Equipment 72 Freight In
21 Furniture and Fixtures 73 Purchase Discounts
30 Accounts Payable 74 Purchase Returns & Allowances
50 Jagiya, Capital 75 Freight Out
51 Jagiya, Drawing 76 Salaries
52 Income Summary 77 Utilities Expense
60 Sales 78 Advertising
79 Office Supplies Used
JAGIYA GENERAL MERCHANDISE has the following Trial Balance for the month of May,
2018.
JAGIYA GENERAL MERCHANDISE
Trial Balance
May 31, 2018
Account No. Account Title Debit Credit
10 Cash P 1,884,325
12 Merchandise Inventory 145,400
30 Accounts Payable P261,771
50 Jagiya, Capital 1,767,954
P2,029,725 P2,029,725
The following transactions took place for the month of June 2018.
June 1 Mrs. Jagiya after one month of operation decided to invest a sum of money
amounting to P1, 650,339 in the business.
June 3 Purchased Merchandise worth P118, 400, 2% trade discount in cash.
June 4 Purchased Office Equipment amounting to P95, 600. Terms: 20% cash and the
balance on account.
June 5 Sold goods to DIAMOND worth P45, 700. Terms: 3/10, 2/15, n/30.
June 7 Paid Freight on June 5, P6, 890.
June 9 Diamond returned merchandise amounting to P15, 300.
June 11 Jagiya collected its account to DIAMOND.
June 15 Purchase Merchandise worth P78, 450 from OPPA. Terms: Cash on Delivery (COD)
June 17 Paid expenses: Salaries, P13, 200; Advertising, P35, 220
June 19 Upon examining the new stocks of the business, Jagiya founded out that 35% of
the value of the purchased merchandise on June 15 were defective and returned
to OPPA.
June 20 The company paid its account amounting to P35, 700.
June 21 Jagiya withdrew cash amounting to P11, 800.
June 30 Sold goods to PETMALU, P458, 900 in cash.
ADDITIONAL INFORMATION: MERCHANDISE INVENTORY AT THE END OF THE PERIOD IS
AMOUNTED TO P183, 400.
JOURNALIZATION PAGE
DATE ACCOUNT TITLES & EXPLANATION F DEBIT CREDIT
JOURNALIZATION PAGE
DATE ACCOUNT TITLES & EXPLANATION F DEBIT CREDIT
POSTING
GENERAL LEDGER
Account: CASH Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: ACCOUNT RECEIVABLE Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: MERCHANDISE INVENTORY Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: NOTES RECEIVABLE Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: OFFICE EQUIPMENT Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: FURNITURE AND FIXTURE Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: ACCOUNTS PAYABLE Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: JAGIYA, DRAWING Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: JAGIYA, CAPITAL Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: INCOME SUMMARY Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: SALES Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: SALES DISCOUNT Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: SALES RETURNS AND ALLOWANCES Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: COST OF GOODS SOLD Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: PURCHASES Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: FREIGHT IN Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: PURCHASE DISCOUNTS Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: PURCHASE RETURNS AND ALLOWANCES Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: FREIGHT OUT Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: SALARIES Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: UTILITIES EXPENSE Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: ADVERTISING Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
Account: OFFICE SUPPLIES EXPENSE Account No:
Debit Credit
Date Particulars F Debit Credit
Balance Balance
TRIAL BALANCE
JAGIYA GENERAL MERCHANDISE
TRIAL BALANCE
JUNE 30, 2018
ACCOUNT
ACCOUNT TITLE DEBIT CREDIT
NUMBER
FINANCIAL STATEMENTS:
JAGIYA GENERAL MERCHANDISE
STATEMENT OF FINANCIAL PERFORMANCE
FOR THE MONTH ENDED JUNE 30, 2018
JAGIYA GENERAL MERCHANDISE
STATEMENT OF FINANCIAL POSITION
FOR THE MONTH ENDED JUNE 30, 2018
JAGIYA GENERAL MERCHANDISE
STATEMENT OF OWNER’S EQUITY
FOR THE MONTH ENDED JUNE 30, 2018
JAGIYA GENERAL MERCHANDISE
STATEMENT OF CASH FLOWS
FOR THE MONTH ENDED JUNE 30, 2018
JAGIYA GENERAL MERCHANDISE
CLOSING JOURNAL ENTRIES
JUNE 30, 2018
DATE ACCOUNT TITLES & EXPLANATION F DEBIT CREDIT
JAGIYA GENERAL MERCHANDISE
CLOSING TRIAL BALANCE
JUNE 30, 2018
ACCOUNT
ACCOUNT TITLE DEBIT CREDIT
NUMBER
PART II: Adjusting Entries
Prepare the Adjusting Entries for each of the following.
1. The business has Accounts Receivable of P15, 900 at the end of 2017. It is
estimated that 85% of this is collectible. Allowance for Doubtful Accounts has
an unadjusted balance of P750 at the year end.
2. Supplies Expenses has a balance of P9, 500 representing supplies purchased
during the year 2017, of which only 4, 500 has been taken out from the
stockroom.
1 2
ADJUSTING ENTRY
DATE
DEBIT
CREDIT
AMOUNT
