Problem Solving

On October 1, 2022, Hari Pata, a restaurant that specializes in crispy pata, entered the second month of operation. Chris P. Pata is the owner of this restaurant. The adjusted trial balance as of October 1, 2022, prepared by his staff is shown below:

Hari Pata Adjusted Trial Balance October 1, 2022
Accounts	Debit	Credit
Cash	200,000
Accounts Receivable	60,000
Allowance for Bad Debts		1,000
Prepaid Rent	36,000
Kitchen Supplies	19,000
Equipment	110,000
Accumulated Depreciation - Equipment		1,500
Accounts Payable		100,000
Salaries Payable		1,500
Unearned Food Service Revenue		22,000
Bank Loan Payable		100,000
Pata, Capital		220,000
Pata, Withdrawals	40,000
Food Service Revenue		122,000
Salaries Expense	41,500
Utilities Expense	20,000
Advertising Expense	10,000
Bad Debts Expense	1,000
Depreciation Expense - Equipment	1,500
Kitchen Supplies Expense	11,000
Rent Expense	18,000
Total	568,000	568,000

Additional Information for the adjusted trial balance as of October 1, 2022 are as follows:

1. The prepaid rent has a remaining term of two months
2. The loan is payable after 2 years. It has an interest rate of 6% per year.
3. The kitchen equipment is expected to be useful for 6 years. The salvage value at the end of 6 years is 2,000.

The following are the transactions for the last quarter of the year:

October 3 Pay the salaries payable

October 5 Collected half of the outstanding receivables

October 15 Purchased 15,000 worth of supplies on account. The company debited kitchen supplies expense

October 20 Pay the 75% of the accounts payable outstanding as of October 1

October 30 Deliver the crispy pata for the customer who made an advance payment last month

October 30 Pay the salaries amounting to 40,000

November 15 Paid 54,000 cash representing the rent for the next three months starting at December 1, 2022. The company debited rent expense upon payment

November 25 Mr. Pata pay the salaries of his staff amounting to 30,000 from his personal money.

December 15 Received 50,000 cash from a customer for payment of crispy pata to be delivered in two equal batches on January 15 and January 31 of the following year.

December 20 The company has a credit sales amounting to 100,000 of which 20% is still outstanding at year end. It has also a cash sales during this date amounting to 140,000.

December 25 Pay the salaries amounting to 20,000

December 28 The total utilities expense for the fourth quarter amounting to 15,000 were paid

Mr. Pata also provided the following information on December 31, 2022:

1. The kitchen supplies were counted on December 31, 2022, and there are only 21,000 worth of supplies left
2. The allowance for bad debts is set to be at 5% of ending account receivables.
3. Salaries to be accrued are 2,500.

Requirements:

1. Prepare the Statement of Changes in Owner's Equity as of December 31, 2022 (3 points)
2. Prepare the Statement of Financial Position as of December 31, 2022 (13 points)