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Chapter 7
Posting to the Ledger

PROBLEM 1: FOR CLASSROOM DISCUSSION

The following were the transactions during the month:
Feb. 1 The sole proprietor of Entity A invested ₱200,000 cash and new equipment worth ₱100,000 to the
business.
12 Entity A rendered services worth ₱70,000 on account.
17 Entity A rendered services worth ₱20,000 on cash basis.
23 Entity A collected accounts receivable of ₱12,000.
27 The sole proprietor of Entity A withdrew ₱4,000 cash from the business.
28 Entity A paid salaries expense of ₱10,000, supplies expense of ₱3,000 and rent expense of ₱18,000
for the month of February 20X1.

Requirement (a):
Feb. 1, 20x1 Cash 200,000
Equipment 100,000
Owner’s equity 300,000

Feb. 12, 20x1 Accounts receivable 70,000

Service fees 70,000

Feb. 17, 20x1 Cash 20,000

Service fees 20,000

Feb. 23, 20x1 Cash 12,000

Accounts receivable 12,000

Feb. 27, 20x1 Owner’s drawings 4,000

Cash 4,000

Feb. 28, 20x1 Salaries expense 10,000

Supplies expense 3,000
Rent expense 18,000
Cash 31,000
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Requirement (b):

GENERAL LEDGER
ASSETS
Cash Accounts receivable
Dr. Cr. Dr. Cr.
Feb. 1 200,000 Feb. 12 70,000
17 20,000 12,000 Feb. 23
23 12,000 4,000 Feb. 27
31,000 28 End. Bal. 58,000
End. Bal. 197,000

Equipment
Dr. Cr.
Feb. 1 100,000

End. Bal. 100,000

EQUITY
Owner’s equity Owner’s drawings
300,000 Feb. 1 Feb. 27 4,000
300,000 End. Bal. End. Bal. 4,000

INCOME EXPENSES
Service fees Salaries expense
Dr. Cr. Dr. Cr.
70,000 Feb. 12
20,000 Feb. 17
Feb. 28 10,000
90,000 End. Bal. 10,000
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Supplies expense
Dr. Cr.

Feb. 28 3,000
End. Bal. 3,000

Rent expense
Dr. Cr.

Feb. 28 18,000
End. Bal. 18,000

Requirement (c):
Entity A
Unadjusted trial balance
February 28, 20x1
Debit Credit
Cash 197,000
Accounts receivable 58,000
Equipment 100,000
Owner's equity 300,000
Owner's drawings 4,000
Service fees 90,000
Salaries expense 10,000
Supplies expense 3,000
Rent expense 18,000
Totals 390,000 390,000
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PROBLEM 2: POSTING
Entity B had the following transactions during the period:
1. The sole owner provided ₱800,000 capital to the business.
2. Entity B rendered services worth ₱300,000, on account.
3. Entity B rendered services worth ₱40,000 on cash basis.
4. Entity B collected ₱120,000 accounts receivable.
5. Entity B paid utilities expense of ₱10,000.

Requirement (a):
1. Cash 800,000
Owner’s equity 800,000

2. Accounts receivable 300,000

Service fees 300,000

3. Cash 40,000
Service fees 40,000

4. Cash 120,000
Accounts receivable 120,000

5. Utilities expense 10,000

Cash 10,000

Requirement (b):

GENERAL LEDGER
ASSETS
Cash Accounts receivable
Dr. Cr. Dr. Cr.
1 800,000 2 300,000
3 40,000 120,000 4
4 120,000 10,000 5
End. Bal. 950,000 End. Bal. 180,000

EQUITY
Owner’s equity
800,000 1
800,000 Bal.

INCOME EXPENSES
Service fees Utilities expense
Dr. Cr. Dr. Cr.
300,000 2
40,000 3
5 10,000
340,000 End. Bal. 10,000
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Requirement (c):
1) 340,000
2) 160,000 (40,000 + 120,000)
3) 10,000
4) 950,000
5) 180,000

PROBLEM 3: POSTING
Entity C had the following transactions during the period:
1. Owner invested ₱1,000,000 cash to the business.
2. Purchased equipment worth ₱58,000 for cash.
3. Purchased office supplies worth ₱300,000 on account (use an asset account).
4. Paid ₱100,000 accounts payable.
5. Rendered services worth ₱500,000, on cash basis.
6. Rendered services worth ₱800,000, on account.
7. Collected ₱700,000 accounts receivable.
8. Paid salaries expense of ₱70,000.
9. Paid interest expense of ₱5,000.
10. Owner withdrew of ₱10,000 cash from the business.

Requirement (a):
1. Cash 1,000,000
Owner’s capital 1,000,000

2. Equipment 58,000
Cash 58,000

3. Prepaid supplies/ Office supplies 300,000

Accounts payable 300,000

4. Accounts payable 100,000

Cash 100,000

5. Cash 500,000
Service fees 500,000

6. Accounts receivable 800,000

Service fees 800,000

7. Cash 700,000
Accounts receivable 700,000

8. Salaries expense 70,000

Cash 70,000
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9. Interest expense 5,000

Cash 5,000

10. Owner’s drawings 10,000

Cash 10,000

Requirement (b):

GENERAL LEDGER
ASSETS
Cash Accounts receivable
Dr. Cr. Dr. Cr.
1 1,000,000 6 800,000
5 500,000 58,000 2 700,000 6
7 700,000 100,000 4
End. Bal. 100,000
70,000 8
5,000 9
10,000 10
End. Bal. 1,957,000

Prepaid supplies/
Office supplies Equipment
Dr. Cr. Dr. Cr.
3 300,000 2 58,000

End. Bal. 300,000 End. Bal. 58,000

LIABILITIES
Accounts payable
300,000 3
4 100,000
200,000 Bal.

EQUITY
Owner’s, Capital
1,000,000 1
1,000,000 Bal.

Owner’s, Drawings
10 10,000
Bal. 10,000

INCOME EXPENSES
Service fees Salaries expense
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500,000 5
800,000 6 8 70,000
1,300,000 Bal. Bal. 70,000

Interest expense

9 5,000
Bal. 5,000

PROBLEM 4: UNADJUSTED TRIAL BALANCE

George Handyman Services
Unadjusted Trial Balance
December 31, 20x1

Accounts Debit Credit

Cash 970,000
Accounts receivable 320,000
Prepaid rent 50,000
Land 700,000
Building 500,000
Accumulated depreciation 400,000
Accounts payable 32,000
Notes payable 800,000
Owner's equity 920,000
Service fees 796,000
Salaries expense 240,000
Utilities expense 72,000
Interest expense 96,000
Totals 2,948,000 2,948,000
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PROBLEM 5: UNADJUSTED TRIAL BALANCE

Entity A
Unadjusted trial balance
December 31, 20x1

Debit Credit
Cash 890,000
Accounts receivable 400,000
Allowance for bad debts 16,000
Prepaid supplies 50,000
Prepaid insurance 30,000
Office equipment 1,000,000
Accumulated depreciation 400,000
Accounts payable 100,000
Salaries payable 60,000
Owner’s equity 291,000
Owner’s drawings 10,000
Service fees 2,200,000
Salaries expense 420,000
Supplies expense 5,000
Bad debt expense 2,000
Depreciation expense 200,000
Taxes and licenses 60,000
Totals 3,067,000 3,067,000

PROBLEM 6: POSTING & UNADJUSTED TRIAL BALANCE

1 The owner contributed ₱400,000 cash to the business.

2 Acquired computer equipment for ₱180,000 cash.
3 Purchased office supplies for ₱20,000 cash.
4 Rendered services worth ₱40,000 on cash basis.
5 Paid ₱8,000 salaries of employees.

Requirement (a):

Feb. 1 Cash 400,000

Owner’s equity 400,000
to record the owner’s contribution
2 Computer equipment 180,000
Cash 180,000
to record the acquisition of equipment
4 Prepaid supplies/ Office supplies 20,000
Cash 20,000
to record the purchase of supplies
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5 Cash 40,000
Service fees 40,000
to record service fees
7 Salaries expense 8,000
Cash 8,000
to record salaries expense

Requirement (b):

ASSETS
Cash
1 400,000
180,000 2
5 40,000 20,000 4
8,000 7
232,000

Prepaid supplies
4 20,000
Bal. 20,000

Computer equipment
2 180,000
Bal. 180,000

EQUITY
Owner’s equity
400,000 1
400,000 Bal.

INCOME EXPENSES
Service fees Salaries expense
40,000 5 7 8,000

40,000 Bal. Bal. 8,000

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Requirement (c):
Entity D
Unadjusted Trial Balance
February 7, 20x1

Accounts Debit Credit

Cash ₱232,000
Prepaid supplies 20,000
Computer equipment 180,000
Owner’s equity ₱400,000
Service fees 40,000
Salaries expense 8,000
Totals ₱440,000 ₱440,000

PROBLEM 7: POSTING & UNADJUSTED TRIAL BALANCE

You opened a servicing business on January 1, 20x1. Your business DTI- registered name is “Mind Your Own
Business” (MYOB). MYOB’s transactions during the year are summarized below:
1. You invested ₱400,000 cash to the business.
2. MYOB obtained a ₱500,000 loan.
3. MYOB placed a newspaper and worth ₱35,000.
4. MYOB purchased equipment worth ₱380,000 for cash.
5. MYOB rendered services worth ₱200,000, on cash basis.
6. MYOB rendered services worth ₱420,000, on account.
7. MYOB collected ₱300,000 accounts receivable.
8. MYOB paid half of the loan in #2 above plus interest expense of ₱60,000.
9. MYOB paid supplies expense of ₱16,000.
10. MYOB paid utilities expense of ₱72,000.
11. MYOB paid salaries expense of ₱120,000.
12. You withdrew ₱90,000 cash from the business.

Requirement (a):
1. Cash 400,000
Owner’s equity 400,000

2. Cash 500,000
Notes payable 500,000

3. Advertising expense 35,000

Cash 35,000

4. Equipment 380,000
Cash 380,000

5. Cash 200,000
Service fees 200,000

6. Accounts receivable 420,000

Service fees 420,000
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7. Cash 300,000
Accounts receivable 300,000

8. Notes payable 250,000

Interest expense 60,000
Cash 310,000

9. Supplies expense 16,000

Cash 16,000

10. Utilities expense 72,000

Cash 72,000

11. Salaries expense 120,000

Cash 120,000

12. Owner’s drawings 90,000

Cash 90,000

Requirement (b):

ASSETS
Cash Accounts receivable
1 400,000
2 500,000 35,000 3 6 420,000
5 200,000 380,000 4 300,000 7
7 300,000 310,000 8
16,000 9
72,000 10
120,000 11
90,000 12
Bal. 377,000 Bal. 120,000

Equipment
4 380,000
Bal. 380,000

LIABILITIES
Notes payable
500,000 2
8 250,000
250,000 Bal.
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EQUITY
Owner’s equity
400,000 1
400,000 Bal.

Owner’s drawings
12 90,000
Bal. 90,000

INCOME EXPENSES
Service fees Advertising expense
200,000 5 3 35,000
420,000 6
620,000 Bal. Bal. 35,000

Interest expense
8 60,000

Bal. 60,000

Supplies expense
9 16,000

Bal. 16,000

Utilities expense
10 72,000

Bal. 72,000

Salaries expense
12 120,000

Bal. 120,000
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Requirement (c): Unadjusted trial balance

Mind Your Own Business

Unadjusted Trial balance
December 31, 20x1

Accounts Debit Credit

Cash 377,000
Accounts receivable 120,000
Equipment 380,000
Notes payable 250,000
Owner's equity 400,000
Owner's drawings 90,000
Service fees 620,000
Advertising expense 35,000
Interest expense 60,000
Supplies expense 16,000
Utilities expense 72,000
Salaries expense 120,000
Totals 1,270,000 1,270,000

PROBLEM 8: POSTING & UNADJUSTED TRIAL BALANCE

Entity A started operations on January 1, 20x1. The following were the

transactions during the first week of operations:

Jan. Transactions
1 The owner provided ₱600,000 cash as initial investment to the business.
2 The business acquired a building for ₱400,000 cash.
3 The business acquired office equipment for ₱100,000 cash.
4 The business purchased supplies for ₱20,000 cash. The business uses a prepaid asset account.
5 The business rendered services worth ₱150,000 on cash basis.
6 The business rendered services worth ₱100,000 on account.
7 The business paid ₱25,000 salaries expense.

Requirement (a): Journal entries

Jan. 1 Cash 600,000

Owner’s, Capital 600,000
to record the owner’s investment to the business
2 Building 400,000
Cash 400,000
to record the acquisition of building for cash
3 Office equipment 100,000
Cash 100,000
to record the acquisition of equipment for cash
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4 Prepaid supplies 20,000

Cash 20,000
to record the purchase of supplies

5 Cash 150,000
Service fees 150,000
to record service fees
6 Accounts receivable 100,000
Service fees 100,000
to record service fees
7 Salaries expense 25,000
Cash 25,000
to record salaries expense

Requirement (b): Posting

ASSETS
Cash Accounts receivable
1 600,000 6 100,000
400,000 2
100,000 3
5 150,000 20,000 4
25,000 7
Bal. 205,000 Bal. 100,000

Prepaid supplies
4 20,000
Bal. 20,000

Building Office equipment

2 400,000 3 100,000
Bal. 400,000 Bal. 100,000

EQUITY
Owner‘s capital
600,000 1
600,000 Bal.

INCOME EXPENSES
Service fees Salaries expense
150,000 5 7 25,000
100,000 6
250,000 Bal. Bal. 25,000
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Requirement (c): Unadjusted trial balance

Entity A
Unadjusted Trial Balance
January 7, 20x1

Accounts Debit Credit

Cash ₱205,000
Accounts receivable 100,000
Prepaid supplies 20,000
Building 400,000
Office equipment 100,000
Owner’s capital ₱600,000
Service fees 250,000
Salaries expense 25,000
₱850,000 ₱850,000

PROBLEM 9: POSTING & UNADJUSTED TRIAL BALANCE

Mr. Uhtred opened a business called Bebbanburg Merchandising. The following were the transactions for the
year ended December 31, 20x1:
1. Mr. Uhtred contributed ₱600,000 to the business.
2. Bebbanburg obtained a loan of ₱400,000.
3. Bebbanburg purchased inventory worth ₱200,000 on cash basis.
4. Bebbanburg purchase inventory worth ₱500,000 on account.
5. Bebbanburg sold goods for ₱900,000, on account. The cost of the goods sold is ₱400,000.
6. Bebbanburg paid ₱400,000 accounts payable.
7. Bebbanburg collected ₱500,000 accounts receivable.
8. Bebbanburg purchased equipment for ₱480,000 cash.
9. Bebbanburg distributed ₱10,000 cash to Mr. Uhtred.
10. Bebbanburg paid interest expense of ₱5,000.

Requirement (a): Journal entries

1. Cash 600,000
Owner’s equity 600,000

2. Cash 400,000
Notes payable 400,000

3. Inventory 200,000
Cash 200,000

4. Inventory 500,000
Accounts payable 500,000

5. Accounts receivable 900,000

Sales 900,000
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Cost of sales 400,000

Inventory 400,000

6. Accounts payable 400,000

Cash 400,000

7. Cash 500,000
Accounts receivable 500,000

8. Equipment 480,000
Cash 480,000

9. Owner’s drawings 10,000

Cash 10,000

10. Interest expense 5,000

Cash 5,000

Requirement (b): Posting to the ledger

ASSETS
Cash Accounts receivable
1 600,000 5 900,000
2 400,000 200,000 3 500,000 7
7 500,000 400,000 6
480,000 8
10,000 9
5,000 10

Bal. 405,000 Bal. 400,000

Inventory
3 200,000
4 500,000 400,000 5

Bal. 300,000

Equipment
8 480,000
Bal. 480,000
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LIABILITIES
Accounts payable
500,000 4
6 400,000
100,000 Bal.

Notes payable
400,000 2

400,000 Bal.

EQUITY
Owner’s equity
600,000 1
600,000 Bal.

Owner’s drawings
9 10,000
Bal. 10,000

INCOME EXPENSES
Sales Cost of sales
900,000 5 5 400,000

900,000 Bal. Bal. 400,000

Interest expense
10 5,000

Bal. 5,000
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Requirement (c): Unadjusted trial balance

Bebbanburg Merchandising
Unadjusted Trial balance
December 31, 20x1

Accounts Debit Credit

Cash 405,000
Accounts receivable 400,000
Inventory 300,000
Equipment 480,000
Accounts payable 100,000
Notes payable 400,000
Owner's equity 600,000
Owner's drawings 10,000
Sales 900,000
Cost of sales 400,000
Interest expense 5,000
Totals 2,000,000 2,000,000

PROBLEM 10: MULITPLE CHOICE

1. After identifying an accountable event and recording it in a debit- credit format, the next step is to
a. prepare the unadjusted trial balance.
b. classify the effect of the transaction on the accounts.
c. prepare the adjusting entries.
d. post the transaction online and wait for friends to like.

2. Transferring the debit and credit amounts of a journal entry to the ledger is called
a. recording.
b. posting.
c. tweeting.
d. liking.

3. In accounting, to post means

a. to record a transaction in debit-credit format.
b. to transfer the debits and credits of a recorded transaction to the affected accounts.
c. to determine whether total debits equal total credits.
d. to update your status.

4. Mr. A, the owner of Alpha Co., invests ₱600,000 cash to the business. Posting this transaction to the ledger
involves which of the
following?
a. Debit to “A, Capital”
b. Credit to “A, Drawings”
c. Credit to “Cash”
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d. Debit to “Cash”

5. The heading of a trial balance will least likely show

a. the name of the business/
b. the date covered by the report/
c. the title of the report.
d. the name of the business owner.

6. What is the usual sequence of accounts in the trial balance?

a. Chronologically or according to the dates of transactions
b. All debits first, then all credits
c. Assets, Expenses, Liabilities, Equity, and Income
d. Assets, Liabilities, Equity, Income and Expenses

7. The accounts, and their balances, shown in the trial balance are derived directly from the
a. Journal.
b. General ledger.
c. Subsidiary ledger.
d. Accountant’s mind.

8. Which of the following accounts is presented on the credit column of the unadjusted trial balance?
a. Cash
b. Accounts receivable
c. Owner’s drawings
d. Service fees

9. Entity A recorded a ₱16,830 amount as ₱16,380. This error is called

a. Transportation error.
b. Transplacement error.
c. Transposition error.
d. Translation error.

10. Which of the following errors can be revealed by a trial balance?

a. A sale transaction was recorded but not posted.
b. The payment of utilities expense was posted as a debit to salaries expense and credit to cash.
c. The debit posting of service fees earned from services rendered on account was posted to “Cash” rather than
“Accounts receivable.” The credit posting was correct.
d. Service fees of ₱81,000 were posted as debit to cash for ₱81,000 and credit to service fees of ₱18,000.