Mr. Henry labasan is engaged in a Rent-A-Car business to cater tourists who are visiting tagbilaran city. His investment consisted of the following:

2 units Toyota Van- P20,000
Cash which he deposited with RCBC, P50,000

Chart of account

Assets
Cash in bank
Accounts Receivable
Tires and Tubes Inventory
Prepaid Insurance
Transportation Equipment

Liabilities
Accounts payable
Unearned Rental Revenue

Owner's equity
H. Labasan, Capital
H. Labasan, Drawing

Income
Rental Revenue

Expenses
Gasoline and Oil
Taxes and Licenses
Commission Expense
Repairs and Maintenance

Transactions:

May 1 - Bought gasoline and oil for the 2 units toyota Van, P30,000

May 2 - Rendered transportation service to various tourists who roamed around the city to watch the sandugo festival, P20,000

May 3 - Paid business permits and licenses including that of the land transportation office, P15,000

May 7 - Rental revenue for the week from tourists for visiting panglao beach resort, Loboc river and chocolate hills, P12,000

May 8 - Received a bill from petron service center for gasoline withdrawn on account, P15,00

May 9 - Paid in advance car insurance (on damaged and third party liability) P7,300

May 10 - bought spare tire on account from tagbilaran Dura-Trac, P8,500

May 14 - Rental Revenue for the week:
Cash, P25,000
On account, P10,000
Payment of the petron Service Center bill, P15,000

May 15 - Paid driver's commission for the week, P7,000

May 16 - Check up of Toyota Van and replacement of exploaded tire and repair of side mirror, P3,500

May 17 - Received a bill from petron Service Center for gasoline withdrawn on account, P17,500

May 22 - Received a cash of P15,000 from Cebu Lions Club for services that has not yet been rendered.
Rental Revenue for the week:
Cash P12,000
On account P15,000
Paid driver's commission, P7,000

May 23 - collected the customer's account of May 14, P10,000

May 24 - Partial payment of account with petron service center, P12,000

May 25 - Paid the account on May 10 with Tagbilaran Dura-Trac in the amount of, P8,500

May 26 - Received P2,800 as payment for a special trip to Baclayon church.
Paid gasoline and oil for cash, P1,000

May 27 - Refunded the amount of P15,000 to cebu Lions Club re-May 22 transaction trip was cancelled.

May 28 Rental revenue for the week, P27,000 broken down as follows:

Cash P20,000
On account, P7,000

May 29 - Paid the driver's commission, P5,600

May 30 - Paid the account with Caltex Philippines, P1,000

May 31 - Paid the account with caltex Philippines, P1,000
- Collected in full the customer's account of May 28 - P7,000 and May 22 - P15,000
- Received cash of P3,000 from Cebu Employees Union for services that has to be rendered yet.
- Minor repair of toyota Van, P2,500

PLEASE! HELP ME WITH MY ASSIGNMENT!

What do YOU think ?
While we're happy to HELP we wont do all the work for you.
Show us what you have done and where you are having problems..

What do you need help with. These are just basic journal entries. Just read the transaction for each day, then you need to analyze the transaction to figure out which accounts you have will be affected and how the account will be affected.

For an example in the opening statement of your problem: The owner invested vehicles and cash into the business. What accounts are being affected? The vehicles are Transportation Equipment, cash is Cash and the investment will be the Owners Capital account. How are the accounts being affected? Vehicles is increasing your Transportation Equipment account, Cash is increasing the Cash account and the investment is increasing the Investment account. The amounts are given with the exception of the investment amount. Now all that needs to be done is to journalize the transaction. So:

Debit Cash for 50,000 (increase)
Debit Transportation Equipment for 20,000 (increase)
Credit H. Labasan, Capital for 70,000 (increase)

Now you should be able to do the journal entries for each transaction.

Note: Your debit and credit total amounts should be the same.

I don't know how to write the last part of each transaction like:

Cash in Bank
Transportation Equipment
H.Labasan, Capital
To record... this part here

And what is the difference between accounts payable and receivable? If its withdrawn on account is it payable or receivable? Is withdrawn on account a debt? LOL I know, I'm a slow learner hihihi

The last part of the transaction is just a summary of the transaction. I gave you the journal entry for your transaction in my previous post. The summary would be: To record the initial investment of the owner (or something similar).


If you actually looked at my previous post you will notice that Cash would be cash in the bank and the amount was for 50,000 and your transportation amount was for 20,000 which were both debits that equal 70,000. Your offsetting credit account will be H. Labason, Capital for 70,000. Now your debits and credits are 70,000.

An Account Receivable is when a customer purchases something in advance and will pay you later. This is when a customer owes you money, hence the word receivable. This is an asset because you (the company) has a right to what the customer owes you.

An Account Payable is where your company, in this case Labason Rent-A-Car Business purchases something in advance and will pay for it later. This is where your company owes another company money, hence the word payable. This is a liability because your (the company) owes money to another entity.

The Withdrawn on account in the May 8 transaction is the same thing as an account payable. Labason Rent-A-Car company has an account with a gasoline company, so when an Labason employee purchases gas for a Labason Vehicle it will be on the Company's account. Now the Labason company owes money to the gas station. The bill or the amount due to the gas company was paid on the My 14 transaction.

A debit or credit just mean a left side or right side post on a T account. For Example in Accounts Payable when you make a purchase on credit or with a credit journal entry, which will be a credit to the T account for Accounts Payable. When you make a payment to the account you will have a debit journal entry, which will be a debit to the T account for Accounts Payable.

Here is a guide to help you with what types of accounts will increase with a debit and what accounts will increase with a credit:

Increase with a Debit and decrease with a Credit
D - Debits
E - Expenses
A - Assets
D - Dividends / Owners Drawing account

Increase with a Credit and decrease with a Debit
C - Credits
U - Unearned Revenue
R - Revenues
L - Liabilities
S - Shareholders Equity / Owners Capital account