Professional Documents
Culture Documents
External Transaction
-exchanges between two
entities.
e.g.
1. Purchase of Office
Supplies
2. Acquisition of Office and
Store Supplies on Credit
3. Payment for business and
operating expenses.
4. Payment of Accounts
Payable.
5. Rendering of Services for
Cash
6. Selling of Goods on
credit.
4. Collection of Accounts
receivable.
Example Company
Statement of Financial Position (Balance Sheet) -Balance Sheet Accounts are
As of December 31, 2014 real or permanent account
-Its ending balance is carried
into the next accounting period
and is not closed.
Assets Liability
Cash and cash Equivalent xx Accounts Payable xx
Investments xx Notes Payable xx
Accounts Receivable xx Unearned Revenue/Deferred Revenue xx
Allowance for Doubtful Account (xx) xx Accrued Expenses xx
Notes Receivable xx Total Liablity xx
Merchandise Inventory xx
Prepaid Expenses xx Equity
Unused Store and Office Supplies xx Owner, Capital xx
Property Plant and Equipment xx Owner, Withdrawal (xx)
Intangible Asset xx Total Equity xx
xx Tota Liability and Owner's Equity xx
Example Company
Statement of Financial Performance (Income Statement)
For the Period Ended December 31, 2014
-Income Statement accounts are temporary
Income /Revenue or nominal account.
Service Revenue xx -They are accounts that are opened at the
beginning of a period and then closed at the
Sales xx end of the period
Gains xx Note: Closing process applies only to
temporary accounts e.g. Withdrawals and
Other Income xx Income /Summary Account.
Gross Income xx
Less: Expenses
Office or Administrative Expenses xx
Office Rent Expense xx
Office Salaries Expense xx
Insurance Expense xx
Utility Expense xx
Depreciation Expense-Furniture and Fixtures xx
Depreciation Expense-Equipment xx
Depreciation Expense-Office Building xx
Office Supplies Expense xx xx
Selling Expense
Store Rent Expense xx
Store Salries Expense xx
Advertising and Promotion Expense xx
Depreciation Expense-Store Furniture and Fix xx
Depreciation Expense-Store Equipment xx
Depreciation Expense-Store Building xx
Store Supplies xx xx
Other Expenses
Losses xx
Miscellaneous Expenses xx xx
Finance Cost
Interest Expense xx
Total Expenses xx
Net Income xx
Effects of transaction in the Accounting Equation
Owner's Equity
Transactions Journal Entry (Capital-
Withdrawal+Revenue-
Asset = Liability + Expenses)
DR CR
1 The owner made initial investment of 500,000.00 Cash Capital 500,000.00 500,000.00
2 The owner made additional investment of 400,000 Cash Capital 400,000.00 400,000.00
3 Rendered Services for Cash 256,000 Cash Service Revenue 256,000.00 256,000.00
4 Rendered Services on Account 400,000 AR Service Revenue 400,000.00 400,000.00
5 Purchase office Furniture on account 75,000 Office Furniture AP 75,000.00 75,000.00
6 Payment of Salaries Expense 120,000 Salaries Expense Cash (120,000.00) (120,000.00)
7 Owner withdrew cash amounting to 50,000 Owners, Witdrawal Cash (50,000.00) (50,000.00)
8 Payment of Accounts Payable related to Transaction #5 AP Cash (75,000.00) (75,000.00)
9 Purchase of Office Supplies for Cash 35,000.00 Office Supplies Cash 35,000.00
(35,000.00)
Total 1,386,000.00 - 1,386,000.00
Asset decrease
when
Asset increase 1. There are
when withdrawals by
1. There are the owner.
investment by 2. Payment of Liabilities Equity
the owner in expenses for increase when decrease
the form of cash payment 1. There is a Equity increase when
Liabilities when 1. There is
cash and non of assets like purchase of decrease
cash asset. PPE and Inv. supplies and 1. There is withdrawals
when additional and incurring
2. Rendering of 3. Payment of PPE on 1. There is
Services for Accounts account or investment by of business
payment of expenses
cash or on Payable/NP bank the owner
AP, NP and
account. 4. Payment of borrowings. 2. There is sale
related
3. Purchase of Accrued 2. There is an of goods and
payable acct..
an asset on Expenses. accrual of services in
account or cash business cash or on
basis expenses account
3. There is a
receipt of
Unearned
/deferred
revenue
-
Total 105,500.00 52,750.00 2,161.90 1,450.63 1,564.50 500.00 5,677.03 47,072.98
Journal Entry
Journal Entry
SSS Contribution Expense 4,453.10
Philhealth Contribution Expense 1,450.63
EC Contribution Expense 70.00
Pag-Ibig Contribution Expense 500.00
SSS Contribution Payable 4,453.10
Philhealth Contribution Payable 1,450.63
EC Contribution Payable 70.00
Pag-Ibig Contribution Payable 500.00
-
To record employer's share in various payroll deduction
ACCOUNTING FOR PAYROLL
Elite General Enterprise
General Payroll
September 16-30, 2017
-
Total 206,604.00 206,604.00 2,906.50 2,840.81 21,699.25 500.00 27,946.56 178,657.44
Journal Entry
Journal Entry
SSS Contribution Expense 6,043.50
Philhealth Contribution Expense 2,840.81
EC Contribution Expense 150.00
Pag-Ibig Contribution Expense 500.00
SSS Contribution Payable 6,043.50
Philhealth Contribution Payable 2,840.81
EC Contribution Payable 150.00
Pag-Ibig Contribution Payable 500.00
-
To record employer's share in various payroll deduction
ACCOUNTING FOR PAYROLL
Rex Trading
General Payroll
April 16-30, 2014
Gloria Moran
Gross Semi Monthly Pay 5,000.00 Journal Entry
Less: SSS Contribution (363.30)
PHIC (125.00) Salary Expense 53,250.00
PAG-IBIG (100.00) SSS Contribution Payable 3,033.60
Taxable Pay 4,411.70 Witholding Tax Payable 4,766.34
Philhealth Contribution Payable 1,312.50
Taxable Pay 4,411.70 Pag-Ibig Payable 700.00
On (See Table) (3,333.00) Cash 43,437.57
Subtotal 1,078.70
Multiply by 15%
Subtotal 161.81
Add 104.17
Witholding Tax 265.98
Journal Entry
SSS Contribution Expense 6,556.50
Philhealth Contribution Expense 1,362.50
EC Contribution Expense 110.00
Pag-Ibig Contribution Expense 700.00
SSS Contribution Payable 6,556.50
Philhealth Contribution Payable 1,362.50
EC Contribution Payable 110.00
Pag-Ibig Contribution Payable 700.00
-
To record employer's share in various payroll deduction
Rich Trading
General Payroll
April 16-30, 2014
1)
Margie Diaz
Gross Semi Monthly Pay 5,000.00 Journal Entry
Less: SSS Contribution (363.30)
PHIC (125.00) Salary Expense 62,500.00
PAG-IBIG (100.00) SSS Contribution Payable 3,233.60
Taxable Pay 4,411.70 Witholding Tax Payable 9,013.54
Philhealth Contribution Payable 1,550.00
Taxable Pay 4,411.70 Pag-Ibig Payable 700.00
On (See Table) 3,333.00 Cash 48,002.87
Subtotal 7,744.70
Multiply by 15% To record Payment of Salaries for the period April 16-30 , 2014
Subtotal 1,161.71
Add 104.17
Witholding Tax 1,265.88
Miguel Vera
Gross Semi Monthly Pay 11,500.00 Journal Entry
Less: SSS Contribution (472.30)
PHIC (316.25) Salary Expense 95,750.00
PAG-IBIG (100.00) SSS Contribution Payable 3,596.80
Taxable Pay 10,611.45 Witholding Tax Payable 6,281.21
Philhealth Contribution Payable 2,633.13
Taxable Pay 10,611.45 Pag-Ibig Payable 700.00
On (See Table) (10,417.00) Cash 82,538.87
Subtotal 194.45
Multiply by 20% To record Payment of Salaries for the period June 16-30 , 2017
Subtotal 38.89
Add -
Witholding Tax 38.89
Name of Employee Tax Status Monthly Salary Semi Monthly SSS Contributions
Jaime Lopez M 35,000.00 17,500.00 581.30
Claire Dy S 25,000.00 12,500.00 581.30
Jessica Santos S 12,000.00 6,000.00 436.00
Dino Santiago M+1 24,000.00 12,000.00 581.30
Susan Haw S+1 9,500.00 4,750.00 345.20
Cindy Lopez M+2 9,500.00 4,750.00 345.20
Margie Diaz S 10,000.00 5,000.00 363.30
Jessica Santos-S
mi Monthly Pay 12,500.00 Gross Semi Monthly Pay
Contribution (581.30) Less: SSS Contribution
(312.50) PHIC
(100.00) PAG-IBIG
11,506.20 Taxable Pay
51,516.94
5,314.00
(5,000.00)
314.00
20%
62.80
354.17
416.97
East System Colleges of Rizal
R. Palma St. San Pedro Morong, Rizal
Fundamentals of Accounting
Numbers 21-50
Mary Joy Albos , the Payroll Accountant of GENUINE GENERAL ENTERPRISE is preparing the payroll from
the period January 1-30, 2018. It is the policy of the company to deduct the SSS, PAG-IBIG, & PHILHEALTH monthly
contributions every 30th of the month while witholding taxes are remitted 15th day of the following month . Details
are as follows:
Required:
1. Complete the Payroll Sheet for the period January 1-31 Use the format /heading below: (2 points each)
Name of Employees
PHIC Cont.
Name of Witholdin Pag-Ibig Total
Employee Tax Status Monthly SSS Cont. g Taxes Cont. Deduction
Total
2. Prepare the journal entries to record the payment of salaries of the employee. (5 points)
3. Complete the Employer's Contribution Table. Use the format/heading below (2 points each)
4. Prepare the journal entries to record the employer's share in the SSS, EC, PHILHEALTH & PAG-IBIG
contribution during payroll. (5 points)
SSS CONTRIBUTION TABLE
PHILHEALTH CONTRIBUTION TABLE
Prepared By:
I. Multiple Choice
Required:
1. Complete the Payroll Sheet for the period September 16-30, 2014. Use the format /heading below: (2 points each)
Name of Employees
PHIC Cont.
Name of Semi Witholdin Pag-Ibig
Employee Tax Status Monthly SSS Cont. g Taxes Cont. Total Deduction
Total
2. Prepare the journal entries to record the payment of salaries of the employee. (5 points)
3. Complete the Employer's Contribution Table. Use the format/heading below (2 points each)
Name of Monthly EC
Employee Salary Credit SSS PHILHEALTH PAG-IBIG TOTAL
4. Prepare the journal entries to record the employer's share in the SSS, EC, PHILHEALTH & PAG-IBIG contribution
during payroll. (5 points)
PHILHEALTH CONTRIBUTION TABLE
Prepared By:
This new and updated SSS Contribution Table will be effective on January 2014.For now, the old SSS Contribution is still applicable.
SE / VM / OFW
Total Contribution
1,045.00
1,100.00
1,155.00
1,210.00
1,265.00
1,320.00
1,375.00
1,430.00
1,485.00
1,540.00
1,595.00
1,650.00
1,705.00
1,760.00
applicable.