Accounting Answers

Beatrice Luigi Gomez established a fashion designing service business in Cebu City on December 2021 which she

named Top 5 Best Designs. Below are the following completed transactions during the first year of business.

Dec. 1 Beatrice transferred cash from a personal account to an account to be used for the business, P243,000.

3 Beatrice invested in the business her personal computer equipment having a fair market value of P34,000.

4 Bought office equipment on account from Robinsons Cybergate, P13,740.

5 Paid rent covering 1 year amounting P70,000. (Use Asset Method)

6 Bought a used service vehicle car for P93,000, paying P45,000 down, with the balance due in thirty days.

9 Received invoice and paid 1-year insurance premium to Cacawa Fidelity company, P25,000. (Use Asse

The following entries have been passed by an accountant. State whether these entries are correct or not. Prepare the correct journal entries.  Date

Cash A/c                                                    Dr.

   To Interest A/c                                                         Cr.

(Being interest paid)

7,000

7,000

Sohan’s A/c                                                Dr.

   To Purchases A/c                                                     Cr.

(Being purchase of goods from Sohan in cash)

10,000

10,000

Hari Om’s A/c                                           Dr.

   To Sales A/c                                                        Cr.

(Being cash sales to Hari Om)

5,000

5,000

Mukesh A/c                                               Dr.

    To Bank A/c                                                          Cr.

(Being salary paid for the month)

10,000

10,000

1. Company X wrote a check for 9,500.00 payable to Andrew Reyes and it cleared with the bank for the same amount. The accounting book of the company however shows that the same check issued to Mr. Reyes was recorded as 5,900.00. What is the effect of this entry to the bank or book balance? What will you do to reconcile the book and bank balances?

1. AJ Imperial is a self-employed professional who offers accounting and business management services. Her total gross receipts amounted to 3,500,000.00 for taxable year 2020. Her recorded cost of service and operating expenses were 1,200,000.00 and 800,000.00 respectively. How will you compute for AJ's tax liability? How much is her gross income, taxable income and graduated income tax due for the year?

1. Dan Tamago is an employee of Itnok Poultry Farm who earns at a minimum. His total compensation income for 2020 amounted to 180,000.00. Tamago contributed 8,100.00 for his SSS, 900.00 for Philhealth and 3,600 for PAG-IBIG. On December 15, he received his 13th month pay at 15,000.00 which is equivalent to his basic monthly salary. How do you classify Mr. Tamago as a taxpayer? How will you compute for his taxable income and how much is the income tax due him?

1. Dominique Taus is a resident Filipino cetizen. She is employed in a multi-national company and a 3-month business trip in Singapore during the taxable year. Aside from her basic salary, she received additional pay while on trip. How will you classify Taus as a taxpayer? How shall she be taxed?

In your own words, explain how you will use the Core Adjacency framework to identify the growth strategy for a business. Choose any business and identify 3 growth strategies for it using the core adjacency framework.

Suppose you are the CEO of an online apartment rental platform. While the industry is extremely competitive, you have managed to attract a lot of customers, and have been successful in helping more than 5 thousand tenants find and book an apartment.

You have been able to this by targeting students as a market segment, and by making the platform absolutely free. There is no cost for tenants or landlord to use the platform. 

However, the company’s investors now need to see the company generating revenues and profits.

How will you transition the company from its current business model of providing the platform for free, to making revenues? 

Write up the asset, capital and liability accounts in the books of D Gough to record the following transactions:

20X9

June 1

• == 2
• == 5
• == 8
• == 12
• == 15
• == 19
• == 21
• == 25
• == 30

Started business with £16,000 in the bank.

Bought van paying by cheque £6,400.

Bought office fixtures £900 on credit from Old Ltd. Bought van on credit from Carton Cars Ltd £7,100. Took £180 out of the bank and put it into the cash till. Bought office fixtures paying by cash £120.

Paid Carton Cars Ltd a cheque for £7,100.

A loan of £500 cash is received from B Berry.

Paid £400 of the cash in hand into the bank account. Bought more office fixtures paying by cheque £480.

On March 31,2021,M. Belottipurchased the right to remove gravelfrom an old rock quarry.The gravelIs to be sold as roadbed for highway construction. The cost of the quarry rights was $331,200,with estimated salable rock of 36,000 tons.During 2021,Belotli loaded and sold 5,000 tons of rock and estimated that 31,000 tons remained at December 31,2021. At January 1,2022,Belotti estimated that 15,000 tons still remained. During 2022,Belotli loaded and sold 10,000 tons. Belotti uses the units-of-production method.