Problem 1A- Transaction Analysis (SERVICE BUSINESS)
a. Mayke Owey invested 60,000 cash to start the business.
b. Purchased a scooter for 75,000. Made a 35,000 cash down payment and issued a
note payable for the remaining balance.
c. Paid Jay-r Dumaji 26,000 for office and space for 6-month rent.
d. Billed customers 12, 140 for services rendered during the first half of February.
e. Paid 11,500 in salaries earned by employees during the first half of February.
f. Owey purchased another vehicle for 210,000. However, the vehicle is intended
for business use. Owey made a 50,000 cash down payment and issued a note
payable for the remaining balance.
g. Collected 4, 120 of the amounts billed to customers.
h. Billed customers 16,450 during the second half of the month.
i. Paid 6,000 in salaries earned by employees during the second half of the month.
j. Received a 2,510 bill from Preenzelco for electric power consumed due next
month.
k. Owey withdrew PHP2,0500 cash from the business.
Analyze the effects that each of these transactions will have on the following six
components of the company’s financial statements for the month. Organize your
answer in tabular form. Use I for increase, D for decrease, and NE for no effect. The
Transaction A is provided for you;
Transaction Balance Sheet Income Statement
Asset Liabilities Equity Revenu Expens Net
e e Income
A I NE I NE NE NE