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FUNDAMENTALS OF ACCOUNTING (1 A&B) Case Problem #1 Place a (+) sign to indicate and increase and a () to indicate a decrease on each

transactions below: Assets 1. 2. 3. 4. 5. Investment of cash in the business Purchase of office supplies for cash Borrowed money from the bank Billed customer for service rendered Collected cash from customers for service rendered 6. Paid salaries 7. Paid creditors on account 8. Paid advertising expense 9. Purchased office equipment, 25% down payment, balance on credit 10. Returned defective supplies which were purchased on account Liabilities Equity

Case Problem #2 The following are transactions of LAOS DELIVERY SERVICE during December 2012: Dec 2 Paid creditors on account, P7,500. 3 Received cash for delivery services rendered, P35,600. 7 Paid advertising expense, P12,000. 9 Paid rent for the month, P35,000. 13 Billed customers for delivery services on account, P42,500. 17 Received cash from customers on account, P22,500. 22 Received cash from the owner as additional investment, P130,000. 27 Paid cash to Jillian, proprietor, for personal use, P14,500. 29 Purchased office equipment on account, P37,800. 30 Received cash from customers on account, P3,000. Required: Indicate the effect of each transaction on the accounting equation. Use the following choices: a) Increase in an Asset; Decrease in another Asset b) Increase in an Asset; Increase in a Liability c) Increase in an Asset; Increase in Equity d) Decrease in an Asset; Decrease in a Liability e) Decrease in an Asset; Decrease in Equity

Case Problem #3 Kopya Center started its operation on January 2012. On January 1, the owner Thelma Ortiz invested cash P20,000 and equipment worth P48,000. The following are the additional transactions for January: Jan 5 Bought furniture and fixtures worth P6,000 on account. 7 Bought another second hand photocopier machine costing P20,000. Terms 50% down payment, balance on account. 8 Hired another helper on a commission basis of 10% of sales, to operate the machine just recently purchased. 10 An emergency prompted Ms. Ortiz to withdraw P500 cash for personal use. 15 Bought supplies costing P3,000 in cash. 20 The first account is due. Ms. Ortiz paid this from her personal cash. 28 The second account is due. Issued a 60-day promissory note. Requirements Prepare a financial transaction worksheet using the following money columns: Cash, Supplies, Furniture & Fixtures, Equipment, Notes Payable, Accounts Payable, Ortiz, Capital and Ortiz, Drawing.

Case Problem #4 NikNik opened his business, CYBERTEA on September 2012 with the following transactions: Sept 2 invested cash of P240,000 and land and building worth P4,400,000. The land has an appraised value of P2,400,000 and is currently mortgage in the bank for P400,000. 4 purchased computer equipment costing P360,000 paying 25% down payment and the balance payable in 60 days. 5 purchased supplies worth P34,000 in cash; paid taxes and licenses, P2,800. 8 paid rent for the month P18,000. 10 NikNik made an additional investment of furniture and fixtures worth P60,000 into the business; cash receipt from customers, P46,000. 15 paid salaries of his two assistants, P12,000. 18 billed customers for computer services rendered, P30,000. 22 NikNik withdrew cash, P10,000 for personal use. 23 received cash P10,000 from customers on account. 25 purchase additional computer units worth P26,000 on account. 25 received cash from customers for service rendered, P29,000. 26 paid the following: repair of computer, P1,400; advertising, P5,000 and miscellaneous expenses P880. 28 cash receipts for computer services rendered, P29,000. 28 paid salaries for the month, P15,000. Use the expanded Accounting Equation

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