In March 2020, Marites Cruz and Marisol Reyes formed MARS Partnership, a NON-VAT Additional Information:

registered Accounting Services with initial capital contribution of P300,000 each and agreed 1. Depreciation on office equipment is 10% per annum based on the office equipment
to share profits and losses equally. balance.
The entity prepares financial statement on a monthly basis; hence, it prepares adjusting and 2. Purchases of supplies are immediately charge to expense
closing entries at the end of each month. 3. Percentage Tax is accrued monthly at 3% of service revenues.
The chart of accounts of MARS Partnership is as follows:
110 Cash
120 Accounts Receivable Presented below is the Post Closing Trial Balance of MARS Partnership for the month ended
130 Input VAT June 30, 2020.
140 Office Equipment Debit Credit
145 Accumulated Depreciation – Office Equipment
210 Accounts Payable
Cash P 365,000
220 Withholding Tax Payable
230 Expanded Withholding Tax Payable
Accounts Receivable 95,000
240 SSS, PhilHealth and Pagibig Contributions Payable Office Equipment 110,000
250 Utilities Payable Accumulated Depreciation- Office Equipment P 3,000
260 Accrued Percentage Tax Payable Withholding Taxes Payable 800
310 Marites Cruz, Capital Expanded Withholding Tax Payable 500
320 Marisol Reyes, Capital SSS, Philhealth and PAG-IBIG Contribution Payable 5,550
330 Marites Cruz, Withdrawals Utilities Payable 4,200
340 Marisol Reyes, Withdrawals Accrued Percentage Tax Payable 4,950
350 Income Summary Marites Cruz, Capital 275,500
410 Service Revenues
Marisol Reyes, Capital 275,500
510 Salaries Expense
520 SSS, PhilHealth and Pagibig Contribution
530 Rent Expense
540 Utilities Expense
550 Supplies Expense
560 Transportation Expenses
570 Depreciation Expense –Office Equipment
580 Percentage Tax Expense
590 Miscellaneous Expense
 REVENUES JOURNAL
Date Invoice No. Accounts Debited P.R. Service Revenue Accounts Receivable
Credit Debit
2020
Jul 5 2001 Apol 8 Grocery Store  35,000 35,000
8 2002 AC Café  25,000 25,000
16 2003 Relax Salon and Spa  30,000 30,000

TOTAL P 90,000 P 90,000

(410) (120)

CASH RECEIPT JOURNAL

Date O.R Invoice Accounts Debited P.R. Accounts Service Cash Debit
No. No. Receivable Revenue
2020
July 3 1051 1010 Emeris Corp  45,000 45,000
7 1052 Green Excel Agency  30,000 30,000
12 1053 2001 Apol 8 Grocery Store  35,000 35,000
14 1054 1006 Redor Security Agency  50,000 50,000
22 1055 2002 AC Café  25,000 25,000

TOTAL P 155,000 P 30,000 P 185,000

(120) (410) (110)
 CASH DISBURSEMENT JOURNAL
Date Check Check No. Accounts Debited P.R Sundry Salaries SSS, PH, Withholding Supplies Input Expanded Cash
Voucher Debit Expense Pag-ibig Tax Payable Expense VAT Withholding Credit
No. Debit Payable Debit Debit Debit Tax Payable
Debit (Credit) Debit
(Credit) (Credit)
2020
Jul 2 3001 1210001 National Bookstore-Office  3,000 360 3360
Supplies
3 3002 1210002 Aldo Office Equipment Center- 140 25,000 3,000 28,000
Office Equipment
10 3003 1210003 Builders Space Corp-Rental 530 10,000 (500) 9,500
11 3004 1210004 BIR  800 500 1,300
12 3005 1210005 SSS, Philhealth and Pagibig  5,550 5,550
15 3006 1210006 Utilities Payable-Water 540 700 700
15 3007 1210007 Utilities Payable-Electricity 540 3,500 3,500
15 3008 1210008 Payroll (Jul 1-15)  24,000 (950) 23,050
30 3009 1210009 Payroll (Jul 16 -31)  24,000 (1,100) (800) 22,100
30 3010 1210010 Martires Cruz, Withdrawals 330 20,000 20,000
30 1210011 Marisol Reyes, Withdrawals 340 20,000 20,000

TOTAL P 79,200 P 48,000 P 3,500 P0 P 3,000 P 3,360 P0 P 137,060

 (510) (520) (220) (550) (130) (230) (110)
 GENERAL JOURNAL
GENERAL JOURNAL ADJUSTING ENTRIES CLOSING JOURNAL ENTRIES
Date Accounts Title and Explanation P.R Debit Credit Date Accounts Title and Explanation P.R Debit Credit
2020 2020
Jul 31 Utilities Expense-Water 540 P 700 Jul 31 Service Revenues 410 P 120,000
Utilities Payable 250 P 700 Income Summary 350 P 120,000
To record water usage for July To close the revenues account

31 Utilities Expense 540 3,500 31 Income Summary 350 73,425

Utilities Payable 250 3,500 Salaries Expense 510 48,000
To record electricity usage for July SSS,Philhealth and Pagibig Contribution 520 3,500
Rent Expense 530 10,000
31 SSS, Philhealth and Pagibig Contribution 520 3,500 Utilities Expense 540 4,200
SSS, Philhealth and Pagibig Contributions Payable
240 3,500 Supplies Expense 550 3,000
To record Employers share on Depreciation Expense-Office Equipment 570 1,125
SSS, Philhealth and Pagibig Percentage Tax Expense 580 3,600
To close the expenses account
31 Depreciation Expense-Office Equipment 570 1,125
Accumulated Depreciation-Office Equipment
145 1,125 31 Income Summary 350 46,575
To record depreciation for July Marites Cruz, Capital 310 23,287.50
Marisol Reyes, Capital 320 23,287.50
31 Percentage Tax Expense 580 3,600 To close the income summary
Accrued Percentage Tax Payable 260 3,600
To record percentage tax for July 31 Marites Cruz, Capital 310 20,000
Marisol Reyes, Capital 320 20,000
Marites, Cruz, Withdrawals 330 20,000
Marisol Reyes, Withdrawals 340 20,000
To close the withdrawals account
 GENERAL LEDGER
110 Cash 145 Accumulated Depreciation- Office Equipment
Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020 2020
Jul 1 Beginning  365,000 365,000 Jul 1 Beginning  3,000 3,000
31 Cash Receipt Journal CRJ-1 185,000 550,000 31 Adjusting GJ1 1,125 4,125
31 Cash Disbursement Journal CDJ-1 137,060 412,940

120 Accounts Receivable 210 Accounts Payable

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020
Jul 1 Beginning  95,000 95,000
31 Revenues Journal RJ-1 90,000 185,000
31 Cash Receipt Journal CRJ-1 155,000 30,000

130 Input VAT 220 Withholding Tax Payable

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020 2020
Jul 31 Cash Disbursement Journal CDJ-1 3,360 3,360 Jul 1 Beginning  800 800
31 Cash Disbursement Journal CDJ1 0 800

140 Office Equipment 230 Expanded Withholding Tax Payable

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020 2020
Jul 1 Beginning  110,000 110,000 Jul 1 Beginning  500 500
3 Purchased CDJ1 25,000 135,000 31 Cash Disbursement Journal CDJ1 0 500
240 SSS, PhilHealthand Pag-Ibig Contribution Payable
Date Description P.R Debit Credit Balance 320 Marisol Reyes, Capital
2020 Date Description P.R Debit Credit Balance
Jul 1 Beginning  5,550 5,550 2020
31 Cash Disbursement Journal CDJ1 3,500 2,050 Jul 1 Beginning  275,500 275,500
31 Adjusting GJ1 3,500 5,550

250 Utilities Payable

Date Description P.R Debit Credit Balance 330 Marites Cuz, Withdrawal
2020 Date Description P.R Debit Credit Balance
Jul 1 Beginning  4,200 4,200 2020
15 Water CDJ1 700 3,500 Jul 30 Cash withdrawals CDJ1 20,000 20,000
15 Electricity CDJ1 3,500 0
31 Adjusting –Water GJ1 700 700
31 Adjusting-Electricity GJ1 3500 4,200
260 Accrued Percentage Tax 340 Marisol Reyes, Withdrawal
Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020 2020
Jul 1 Beginning  4,950 4,950 Jul 30 Cash withdrawals CDJ1 20,000 20,000
31 Adjusting GJ1 3,600 8,550

310 Marites Cruz, Capital

Date Description P.R Debit Credit Balance 350 Income Summary
2020 Date Description P.R Debit Credit Balance
Jul 1 Beginning  275,500 275,500 2020
Jul 31 Closing CJ1 120,000 120,000
31 Closing CJ1 73,425 46,575
31 Closing CJ 46,575 0
410 Service Revenue 540 Utilities Expense
Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020 2020
Jul 31 Revenues Journal RJ1 90,000 90,000 Jul 31 Adjusting - Water GJ1 700 700
31 Cash Receipt Journal CRJ1 30,000 120,000 31 Adjusting -Electricity GJ1 3,500 4,200
31 Closing CJ1 120,000 0 31 Closing CJ1 4,200 0

510 Salaries Expense 550 Supplies Expense

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020 2020
Jul 31 Cash Disbursement Journal CDJ1 48,000 48,000 Jul 31 Cash Disbursement Journal CDJ1 3,000 3,000
31 Closing CJ1 48,000 0 31 Closing CJ1 3,000 0

520 SSS, Philhealth and Pag-Ibig Contribution 560 Transportation Expense

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020
Jul 31 Adjusting GJ1 3,500 3,500
31 Closing CJ1 3,500 0

530 Rent Expense 570 Depreciation Expense

Date Description P.R Debit Credit Balance Date Description P.R Debit Credit Balance
2020 2020
Jul 10 Cash Disbursement Journal CDJ1 10,000 10,000 Jul 31 Adjusting GJ1 1,125 1,125
31 Closing CJ1 10,000 0 31 Closing CJ1 1,125 0
 Accounts Receivable- Apol 8 Grocery Store
580 Percentage Tax Expense Date Description P.R Debit Credit Balance
Date Description P.R Debit Credit Balance 2020
2020 Jul 5 Issued Invoice No. 2001 RJ1 35,000 35,000
Jul 31 Adjusting GJ1 3,600 3,600 12 Issued OR No. 1053 CRJ1 35,000 0
31 Closing CJ1 3,600 0

Accounts Receivable- AC Café

590 Miscellaneous Expense Date Description P.R Debit Credit Balance
Date Description P.R Debit Credit Balance 2020
Jul 8 Issued Invoice No. 2002 RJ1 25,000 25,000
22 Issued OR No. 1055 CRJ1 25,000 0

Accounts Receivable- Redor Agency

Date Description P.R Debit Credit Balance
SUBSIDIARY LEDGER 2020
Accounts Receivable- Emeris Corp. Jul 1 Issued Invoice No. 1006  50,000 50,000
Date Description P.R Debit Credit Balance 14 Issued OR No. 1054 CRJ1 50,000 0
2020
Jul 1 Issued Invoice No. 1010  45,000 45,000
3 Issued OR No. 1051 CRJ1 45,000 0 Accounts Receivable- Relax Salon and Spa
Date Description P.R Debit Credit Balance
2020
Jul 16 Issued Invoice No. 2003 RJ1 30,000 30,000
 MARS PARTNERSHIP
Worksheet
For the Month Ended July 31, 2020

Account Account Title Trial Balance Adjustment Income Statement Balance Sheet
No. Debit Credit Debit Credit Debit Credit Debit Credit
110 Cash P 412,940 P 412,940
120 Accounts Receivable 30,000 30,000
130 Input VAT 3,360 3,360
140 Office Equipment 135,000 135,000
145 Accumulated Depreciation-Office Equipment P 1,125 P 4,125
P 3,000
220 Withholding Tax Payable 800 800
230 Expanded Withholding Tax Payable 500
500
240 SSS, PH and Pagibig Contri. Payable 2,050 3,500 5,550
250 Utilities Payable 4,200 4,200
260 Accrued Percentage Tax Payable 4,950 3,600 8,550
310 Marites Cruz, Capital 275,500 275,500
320 Marisol Reyes, Capital 275,500 275,500
330 Marites Cruz, Withdrawals 20,000 20,000
340 Marisol Reyes, Withdrawals 20,000 20,000
410 Service Revenues 120,000 P 120,000
510 Salaries Expense 48,000 P 48,000
520 SSS, PH and Pagibig Contri P 3,500 3,500
530 Rent Expense 10,000 10,000
540 Utilities Expense 4,200 4,200
550 Supplies Expense 3,000 3,000
570 Depreciation Expense-Office Equipment 1,125 1,125
580 Percentage Tax Expense 3,600 3,600

P 682,300 P 682,300 P 12,425 P 12,425 P 73,425 P 120,000 P 621,300 P 574,725

Net Income 46,575 46,575
TOTAL P 120,000 P 120,000 P 621,300 P 621,300
 Mars Partnership
Statement of Comprehensive Income Mars Partnership
For the month ended July 31, 2020 Statement of Financial Position
July 31, 2020
REVENUES
Service Revenue P 120,000 ASSETS
Cash P 412,940
OPERATING EXPENSES Accounts Receivable 30,000
Salaries Expense P 48,000 Input VAT 3,360
SSS, PH and Pagibig Contribution 3,500 Total Current Asset P 446,300
Rent Expense 10,000 Office Equipment P 135,000
Utilities Expense 4,200 Accumulated Depreciation (4,125)
Supplies Expense 3,000 Total Non-current Asset P 130,875
Depreciation Expense 1,125 TOTAL ASSET P 577,175
Percentage Tax Expense 3,600
Miscellaneous Expense LIABILITIES
Total Expenses (73,425) Accounts Payable P
Net Income P 46,575 Withholding Tax Payable 800
Expanded Withholding Tax Payable 500
SSS, PH and Pagibig Cont. 5,550
Mars Partnership
Utilities Payable 4,200
Statement of Partner’s Equity
Accrued Percentage Tax 8,550
For the Month Ended July 31, 2020
Total Liabilities P 19,600

Marites Cruz Marisol Reyes Totals

Beginning Capital P 275,500 P 275,500 P 551,000
PARTNERS EQUITY
Drawings (20,000) (20,000) (40,000)
Marites Cruz, Capital–07/31/2020 P 278,787.50
Net Income 23,287.50 23,287.50 46,575
Marisol Reyes, Capital – 07/31/2020 278,787.50
Ending Capital P 278,787.50 P 278,787.50 P557,575
Total Partner’s Equity 557,575
TOTAL LIABILITIES AND PARTNERS EQUITY P 577,175
 Mars Partnership
Mars Partnership Post-Closing Trial Balance
Statement of Cash Flows July 31, 2020
For the Month Ended July 31, 2020
Account Titles Debit Credit
CASH-IN ACTIVITIES:
Cash from Clients P 30,000 110 Cash 412,940
Cash from Receivables 155,000 120 Accounts Receivable 30,000

Total Cash-In P 185,000 130 Input VAT 3,360

CASH-OUT ACTIVITIES:
140 Office Equipment 135,000
Payment for Supplies 3,360
Payment for Office Equipment 28,000 145 Accumulated Depreciation-Office Equipment P 4,125
Payment for Rental 9,500
Payment for BIR 1,300 220 Withholding Tax Payable 800
Payment for SSS,Philhealth and Pagibig 5,550
230 Expanded Withholding Tax Payable 500
Payment for Water (June Bill) 700
Payment for Electricity (June Bill) 3,500 240 SSS,Philhealth and Pagibig Contri Payable 5,550
Payment for Payroll (Jul 1 – 15) 23,050
Payment for Payroll (Jul 16-31) 22,100 250 Utilities Payable 4,200
Marites Cruz, Withdrawals 20,000 260 Accrued Percentage Tax Payable 8,550
Marisel Reyes, Withdrawals 20,000
41310 Marites Cruz, Capital 278,787.50
Total Cash-Out (137,060)
320 Marisol Reyes, Capital 278,787.50
NET INCREASE IN CASH P 47,940
Add: Cash Balance, 07/01/2020 365,000
CASH BALANCE, 07/31/2020 P 412,940

P 581,300 P 581,300