The Unadjusted Trial Balance of Juan Luna, Inc. for the calendar year ended, December 31, 2019, their initial year of operation, is presented as follows: Debit Credit Cash 5,558,365 Accounts Receivable 1,000,000 Other Current Receivable 16,925 Supplies 7,845 Prepaid Rent 27,000 Prepaid Insurance 3,120 Merchandise Inventory Land 341,180 Equipment 500,000 Accumulated Depreciation- Equipment Truck 1,000,000 Accumulated Depreciation Truck Accounts
The Unadjusted Trial Balance of Juan Luna, Inc. for the calendar year ended, December 31, 2019, their initial year of operation, is presented as follows:
Other Current Receivable
Accumulated Depreciation- Equipment
Accumulated Depreciation – Truck
Other Current Payable
Unearned Rent Revenue
Income Tax Payable
Notes Payable, Long Term
Ordinary Share Capital , 8,133 shares at P 100 par.
Accumulated Other Comprehensive
Other Service Revenue
Sales, 190,000 units
Cost of Goods Sold
Income Tax Expense
1. Gross purchases during the year
100,000 units at P 60
70,000 at P70
50,000 at P 80
2. Purchase returns were from the purchases made as follows:
3. Purchase allowance is a deduction of P 5 from September 2 purchase from the net purchase.
4. The company used FIFO as cost flow method.
5. Information for adjustments at the end of the period.
a. The physical count shows P 5,895 of supplies on hand.
b. The prepaid rent amount is good for 1 year paid last October 1.
c. The prepaid insurance pertains to a one-year premium paid in advance on July 1.
d. Wages earned by employees in December 2017 are P 7,500, and yet they will not be paid until January 5, 2020.
e. On September 1, the company rented out the land to Aguinaldo Co. and received a full year rent of P 132,000.
f. On December 15, the company received a bill of P 235 for utilities, but this one will not be paid until its due date on January 15, 2020.
g. All fixed assets are depreciated on a straight line basis based on a 10-year period, no residual value, starting from its purchase, July 1, 2019.
h. The income tax rate is 30%. (Assume that the book income is equal to the taxable income)
Prepare the statement of comprehensive income, statement of changes in capital, statement of financial position and cash flow statement of Juan Luna Corporation for the year ended, December 31, 2017
11. Using the problem above, How much is the net purchases during the year?
12. Using the problem above, the total depreciation Expense is
14. Using the problem above, How many units of products were on hand at year end?
15. Using the problem above, How much is the average selling price of the company’s product?
16. Using the problem above, the adjusted wages expense is
17. Using the problem above, the balance of total Long Term assets at year end is
Horngrens Financial and Managerial Accounting
Authors: Tracie L. Nobles, Brenda L. Mattison, Ella Mae Matsumura