MINSUPALA TRADING CORPORATION

ACCOUNT DEBIT CREDIT

A. Pre-Operating Period (December 1-31, 2015)
1 Cash 5,000,000
Common Stock 5,000,000
To set up the common stock account.

2 Cash 2,500,000
Current Portion of Loan Payable 2,500,000
To record 5-year loan with Land Bank, payable semi-annually at 10% interest rate.

3 Warehouse Building 3,500,000

Cash 3,500,000
To record purchase of warehouse.

4 Entered into a 3-year with Php 120,000 annual rent

Done advanced every January 2
5 Inventory 850,000
Cash 850,000
To record purchase of goods for inventory.

B. Operating Period (2016)

1 Inventory 975,000
Cash 775,000
Accounts Payable 200,000
To record purchase of inventory.

2 Cash 250,000
Accounts Receivable 3,025,000
Sales 3,275,000
To record 2016 sales.

3 Cash 2,000,000
Accounts Receivable 2,000,000
To record collections of sales on account.

4 Cost of Goods Sold 1,400,000

Inventory 1,400,000
To record cost of goods sold (inventory available for sale less unsold inventory)

5 Salaries and Professional Fees 780,000

 Marketing and Selling Expense 85,000
Utilities and Supplies Expense 75,000
Transportation Expense 60,000
Representation and Meetings Expense 36,000
Miscellaneous Expense 12,000
Cash 1,048,000
To record expenses paid in cash.

6 SSS and Medicare Premium Expense 12,000

SSS and Medicare Premium Payable 12,000
To record unpaid SSS and Medicare premiums.

7 Rent Expense 120,000

Cash 120,000
To record payment of rent for the year.

8 Loan Payable, net of current portion 500,000

Interest Expense 237,500
Cash 737,500
To record payment of interest and principal on Land Bank Loan.

Principal Interest
January 1, 2015 - -
June 30, 2015 250,000 125,000
December 30, 2015 250,000 112,500
Total 500,000 237,500
Interest Rate 10%

9 Depreciation Expense 350,000

Accumulated Depreciation 350,000
To record depreciation expense on warehouse building.

Warehouse Building at Cost 3,500,000

Salvage Value -
Depreciable Cost 3,500,000
Useful Life 10
Depreciation Expense 350,000

10 <Select Account>
<Select Account>
To record income tax expense.

Earnings before Tax 107,500

Income Tax Rate
Income Tax Expense -
ASSET ACCOUNTS
Cash Warehouse Build
-
A1 5,000,000 A3
A2 2,500,000 31-Dec-15
A3 3,500,000
A5 850,000 31-Dec-16
31-Dec-15 3,150,000
B1 775,000
B2 250,000 50,000 Accumulated Deprec
B3 2,000,000
B5 1,048,000
B7 120,000
B8 737,500
31-Dec-16 2,669,500

LIABILITY ACCOUNTS
Loan Payable Accounts Payabl
-
A2 2,500,000
31-Dec-15 2,500,000
B8 500,000
31-Dec-16 2,000,000

SHAREHOLDERS' EQUITY ACCOUNTS

Common Stock Retained Earning
-
A1 5,000,000
31-Dec-15 5,000,000
100,000
31-Dec-16 4,900,000
REVENUE ACCOUNTS
Sales
-
B2 3,275,000

31-Dec-16 3,275,000

EXPENSE ACCOUNTS
 Cost of Goods Sold Salaries and Profession
-
B4 1,400,000 B5

31-Dec-16 1,400,000 31-Dec-16

Transportation Expense Representation and Meetin

-
B5 60,000 B5

31-Dec-16 60,000 31-Dec-16

Rent Expense Interest Expens

-
B7 120,000 B8

31-Dec-16 120,000 31-Dec-16

Balance
2,500,000
2,250,000
2,000,000
 Warehouse Building Inventory
- -
3,500,000 A5 850,000
3,500,000
31-Dec-15 850,000
3,500,000 B1 975,000
B4
31-Dec-16 425,000
Accumulated Depreciation
31-Dec-15 -
B9 350,000

31-Dec-16 350,000

Accounts Payable SSS and Medicare Premium Payable

31-Dec-15 - 31-Dec-15
B1 200,000 B6
50,000
31-Dec-16 250,000 31-Dec-16

Retained Earnings
31-Dec-15 -

31-Dec-16 -
 Salaries and Professional Fees Marketing and Selling Expense
- -
780,000 B5 85,000

780,000 31-Dec-16 85,000

Representation and Meetings Expense Miscellaneous Expense

- -
36,000 B5 12,000

36,000 31-Dec-16 12,000

Interest Expense Depreciation Expense

- -
237,500 B9 350,000

237,500 31-Dec-16 350,000

ntory Accounts Receivable
31-Dec-15 -
B2 3,025,000
B3 2,000,000
31-Dec-16 1,025,000

1,400,000

Premium Payable Income Tax Payable

- 31-Dec-15 -
12,000 B10

12,000 31-Dec-16 -
Selling Expense Utilities and Supplies Expense
-
B5 75,000

31-Dec-16 75,000

us Expense SSS and Medicare Premium Expense

-
B6 12,000

31-Dec-16 12,000

on Expense Income Tax Expense

-
B10

31-Dec-16 -
MINSUPALA TRADING CORPORATION
Statement of Financial Position
As of 31 December 2015

ASSETS
Current Assets
Cash 3,150,000
Accounts Receivable -
Inventory 850,000
Total Current Assets 4,000,000

Non-Current Assets
Warehouse Building 3,500,000
Less: Accumulated Depreciation -
Warehouse Building, net 3,500,000

TOTAL ASSETS 7,500,000

LIABILITIES
Current Liabilities
Current Portion of Loan Payable -
Total Current Assets -
Non-Current Liabilities
Loan Payable, net of current portion 2,500,000
Total Liabilities 2,500,000

SHAREHOLDERS' EQUITY
Common Stock 5,000,000
Retained Earnings -
Total Shareholders' Equity 5,000,000

Total Liabilities and Stockholders' Equity 7,500,000

MINSUPALA TRADING CORPORATION
Statement of Financial Position
As of 31 December 2016

ASSETS
Current Assets
Cash 2,669,500
Accounts Receivable 1,025,000
Inventory 425,000
Total Current Assets 4,119,500

Non-Current Assets
Warehouse Building 3,500,000
Less: Accumulated Depreciation (350,000)
Warehouse Building, net 3,150,000

TOTAL ASSETS 7,269,500

LIABILITIES
Current Assets
Accounts Payable 250,000
SSS and Medicare Premium Payable 12,000
Income Tax Payable 35,475
Current Portion of Loan Payable 500,000
Total Current Assets 797,475
Non-Current Liabilities
Loan Payable, net of current portion 1,500,000
Total Liabilities 2,297,475

SHAREHOLDERS' EQUITY
Common Stock 4,900,000
Retained Earnings 72,025
Total Shareholders' Equity 4,972,025

Total Liabilities and Stockholders' Equity 7,269,500

MINSUPALA TRADING CORPORATION
Income Statement
For the Year Ended 2016

Sales 3,275,000
Less: Cost of Goods Sold (1,400,000)
Gross Profit 1,875,000
Operating Expenses
Salaries and Professional Fees 780,000
Marketing and Selling Expense 85,000
Utilities and Supplies Expense 75,000
Transportation Expense 60,000
Representation and Meetings Expense 36,000
Miscellaneous Expense 12,000
SSS and Medicare Premium Expense 12,000
Rent Expense 120,000
Depreciation Expense 350,000
Total Operating Expenses 1,530,000

Operating Income 345,000

Less: Interest Expense (237,500)
Earnings before tax 107,500
Less: Income Tax Expense (35,475)
Net Income 72,025

Retained Earnings, 12/31/2015 -

Add: Net Income 72,025
Retained Earnings, 12/31/ 2016 72,025
MINSUPALA TRADING CORPORATION
Chart of Accounts

<Select Account>
Cash
Accounts Receivable
Inventory
Warehouse Building
Accumulated Depreciation
Accounts Payable
SSS and Medicare Premium Payable
Income Tax Payable
Current Portion of Loan Payable
Loan Payable, net of current portion
Common Stock
Retained Earnings
Sales
Cost of Goods Sold
Salaries and Professional Fees
Marketing and Selling Expense
Utilities and Supplies Expense
Transportation Expense
Representation and Meetings Expense
Miscellaneous Expense
SSS and Medicare Premium Expense
Rent Expense
Depreciation Expense
Interest Expense
Income Tax Expense