ADAMSON UNIVERSITY
COLLEGE OF BUSINESS ADMINISTRATION
IT APPLICATION TOOLS IN BUSINESS
MODULE 3 : ACCOUNTING CYCLE
The following are the steps in the accounting cycle, namely:
1. Analyzing business transactions through source documents.
2. Recording transactions – Journalizing
3. Posting transactions/entries to special ledgers/general ledger.
4. Preparing the trial balance.
5. Preparing the ten-column worksheet and making the necessary adjusting journal entries.
6. Preparing the financial statements based on adjusted account balances.
7. Recording adjusting entries to the journals/special journals and posting to the ledger.
8. Recording and posting of closing entries.
9. Ruling and balancing real and nominal accounts.
10. Preparing a post closing trial balance.
11. Preparing reversing entries.
CASE ANALYSIS 1
1. Recording transactions – Journalizing (SERVICE BUSINESS)
DATE
(December) TRANSACTIONS
1 Dr. BELO invested P1,000,000 in the business.
Purchased land and building amounting to P1,000,000 and P2,500,000,
1 respectively from the BYD Bank as follows: payment of cash P500,000 and
issuance of a 4-year, 18% notes,
P3,000,000.
Bought medical equipment, P300,000 on account from ABC Corporation by
1 issuing a 20% note payable due in 12 months. On the same date, Dr. BELO
bought medical supplies,
P50,000.
1 Additional medical equipment was purchased worth P52,000 on account
(not secured by
a promissory note).
2 Purchased office supplies, P3,000 for cash.
3 Payment insurance premium for the building, P28,000.
4 Received P132,000 from clients for medical services rendered.
6 Additional medical supplies purchased on account, P42,000.
10 Salaries of medical staff paid, P 90,000.
15 Received P200,000 as payment for seminar fees.
17 Rendered medical services to clients on account, P180,000.
18 Payment for various minor repairs on building, P14,000.
20 Paid the telephone bill, P6,500.
22 Collected P130,000 from clients on account.
23 Made partial payment of P30,000 for the medical supplies purchased on
December 6.
27 Personal withdrawals, P100,000.
29 Paid membership dues of P2,000 and subscription of P2,800.
29 Billed customers for medical services rendered, P280,000.
The company’s Chart of Accounts is as follows:
ACCOUNT
CODE ACCOUNT TITLE
ASSETS
101 Cash
102 Accounts receivable
103 Medical supplies
104 Office supplies
105 Prepaid insurance
106 Land
107 Building
108 Accum Depreciation – building
109 Medical equipment
110 Accum Depreciation – medical equipment
LIABILITIES
201 Accounts payable
202 Notes payable
203 Unearned revenues
204 Interest payable
205 Utilities payable
206 Salaries payable
EQUITY
301 Dr. BELO, Capital
302 Dr. BELO, personal
303 Income Summary
INCOME
401 Professional fees Income
402 Other Income - Training
EXPENSES
501 Salaries expense
502 Insurance expense
503 Repairs & Maintenance expense
504 Utilities expense
505 Communication expense
506 Depreciation expense – Building
507 Depreciation expense – Equipment
508 Medical supplies expense
509 Office supplies expense
510 Interest expense
511 Dues and subscriptions
REQUIRED:
1. Prepare the journal entries for the above-mentioned transactions of Dr. BELO Medical Services.
Present your answer using the format below. Use a yellow pad paper for your answer.
DATE ACCOUNT
CODE ACCOUNT TITLES DEBIT CREDIT
2. Posting of journal entries to the General Ledger. Use the format below. Write your answers in a
yellow pad paper.
ACCOUNT TITLE: CASH ACCOUNT
CODE : 101
Date Item F Debit Credit
December 1 GJ 1
3. Prepare the Trial Balance. Use the format below. Write your answer ( in good form) in a yellow
pad paper.
DR. BELO MEDICAL SERVICES
TRIAL BALANCE
December 31, 2024
PR Debit Credit
0.00
0.00
0.00
0.00
0.00
TOTAL 0.00 0.00
SEATWORK: OCTOBER 13, 2025
Mr. ANTONIANO opened his RD Power Promotions Agency on January 1, 2025. His records showed the
following ledger balances on December 31, 2025.
ACCOUNTS DEBIT CREDIT
Accounts payable P 9,250
Accounts receivable P 2,600
Cash 2,700
Advertising fees earned 34,400
Advertising supplies used 400
Electricity expense 800
Gas and water expense 200
Miscellaneous expense 400
Rent expense 3,680
Salary expense 10,560
Telephone expense 240
Office equipment 20,700
Antoniano, capital 10,000
Antoniano, personal 1,450
Notes payable 1,660
TOTALS P 43,330 P 55,710
The following errors were discovered:
1. Collected and recorded an account of a customer for P500 but posted to the Accounts
Receivable ledger for P5,000.
2. A note payable for medical equipment bought for P2,500 was posted by the accountant to the
Accounts payable account.
3. Telephone expense recorded at P500 was not posted to the ledger.
4. A debit to Antoniano, personal for P1,750 was debited to the capital account.
5. Advertising Fees Earned of P500 was posted twice.
6. Footing for cash on the debit side was understated by P450.
7. Accounts Payable paid amounting to P4,065 was posted on the credit side.
8. Advertising supplies used was copied in the trial balance on the credit side.
REQUIRED:
1. Prepare the adjusting journal entries.
2. Prepare a corrected trial balance.