Adjusting Entries – III. Provide the adjusting journal entriesat year-end 2019 for the
following independent situations (assume calendar year)
1. On March 1, 2019. Finland Tutorials received P60,000representing an advance
payment for services to be rendered in November 2019. This wasbooked using a real
account. At year end, only 70% of the expected service wasrendered.
2. The trial balance of Mangolia Café shows Kitchen Supplies andKitchen Supplies
Expense accounts at balances of P8,400 and P0, respectively. Atyear-end, there are
P1,480 of supplies on hand.
3. On June 15, 2019, Russia Beauty Shop paid P18,000 to SecureInsurance Company for a three-year insurance policy. This was takenup in the books using a real account.
4. China Chickens received a 90 – day, P18%, P175,000 note froma customer for
catering services rendered. The note matures on February 14,2020.
5. On May 1, 2019. Indonesia Services mortgaged a piece of realproperty to a local bank. Proceeds amounted to P499,200, net of 4%services charges. The mortgage requires annual payment of 12%interest starting May 1, 2020.
5. On March 1, 2019, Pakistan Job Placements decided to subleasea portion of its office to a review center for a P8,500 a month.The review center occupied the space on September 1, 2019. Becauseof a tight budget, the review center requested Pakistan if it couldmake the first payment on January 15, 2020. Pakistan yielded tothis request.
7. The Unearned Subscriptions Revenue account of Iran Eventsshowed a balance of
P268, 500 composed of the following:
a. One-year subscription starting July 1, 2019, P87,000.
b. Two-year subscriptions starting February 1, 2019,P95,700.
c. Eight-month subscription starting April 1, 2019, P85,800.
8. Mexico Skin Care bought a piece of salon equipment forP75,000 on January 15, 2019. It has an estimated useful life offive years. Scrap value has been determined to be 10% of theacquisition cost.
9. Australia Delivery needed four trucks in 2019. Two truckswere purchased on May 1, 2019 at P1,850,000 each and another twotrucks were purchased on July 1, 2019 at a total price 15% higherthan the May 1, 2019 purchase. For this type ofdepreciable assets,Australia is allocating 8% of the acquisition cost for scrap valueand estimating useful lives at eight years.
