COMPREHENSIVE ILLUSTRATION – MERCHANDISING

Listed below are the February 1, 2019 account balances for the Kaya Kho Toe Shoes:
During the month of February 2019, the following transactions occurred:

Feb. 1 Collected P113,000 from customers on account.

2 Paid P64,000 of accounts due less discounts of 3%.
4 Purchased merchandise, P170,000. Terms: FOB shipping point; 3/10, n/30.
5 Sold merchandise on account to Gonzales Inc., P270,000. Terms: FOB shipping point;
2/10, n/30.
7 Paid for advertising for the month of February, P6,000.
7 Sold Merchandise for cash, P250,000.
8 Paid the amount due from the Feb. 4 transactions.
9 Paid Iloilo Freight P4,000 for delivering merchandise last Feb. 4.
10 Received returns from the Gonzales Inc., P70,000.
12 Received from the Gonzales, Inc. less returns and discounts.
14 Paid P26,000 interest on the mortgage payable.
15 Paid salaries, P51,000.
16 Sold merchandise on account to Ronzales Corp., P392,000. Terms: FOB destination;
2/10, n/30.
18 Paid P4,000 freight charges on the sale of Feb. 16.
19 Acquired supplies for cash, P21,000.
20 Purchased P125,000 of merchandise from Lozada Imports on account. Terms: FOB
destination; 3/10, n/30.
22 Paid P7,000 miscellaneous expenses.
23 Received payment from Ronzales Corp. less discounts.
24 Purchased P373,000 of merchandise on account from Agustin Enterprises. Terms: FOB
shipping point; 3/10, n/30.
24 Paid La Paz Express P9,000 freight for delivering merchandise acquired from Agustin.
25 Sold merchandise to Ronzales Corp. on account, P420,000. Terms: FOB shipping point;
2/10, n/30.
26 Received returns from Ronzales Corp., P71,000.
28 Kaya Kho withdrew P400,000 from the business.
28 Returned merchandise purchased from Agustin on June 24, P25,000.
Required:
1. Post the Feb. 1, 2019 account balances to the ledger accounts.
2. Record the transactions for the month of February in a journal and post the transactions to the
ledger (Use T account instead of general ledger).
3. Prepare the worksheet using the following information:
a. Salaries in the amount of P51,000 have accrued on Feb. 28.
b. Insurance coverage with premiums of P2,000 has expired at month-end.
c. Depreciation on the building and on the equipment for the month amounted to P9,000 and
P12,000 respectively.
d. Supplies on hand at month-end amounted to P14,000.
e. A count of the merchandise inventory on Feb. 28, 2019 amounted to P397,000.
4. Prepare an income statement and a statement of changes in equity for the month ended Feb. 28,
2019, and the balance sheet as at Feb. 28, 2019.
5. Prepare the adjusting and closing entries for the month.
6. Post the adjusting and closing entries to the ledger (Post to T account instead of general ledger).