Answers For Chapters 1 To 3 - Far

1 EXERCISES 1-1 On December 31, 2019, Jag Company had total assets of P 640,000 and total liabilities of P180,000. During 2020, the company had total revenues of P 560,000 and total expenses of P 460,000. Also during 2020, the owner withdrew P 60,000. On December 31, 2020, total assets were P 840,000. P460,000 1. Compute the owners equity on December 31, 2019 P100,000 2. Compute the net income for the year 2020. P340,000 3. Compute the total liabilities on December 31, 2020. P500,000 4. Compute the owners equity on December 31, 2020. Solutions: 1. Owners Equity = Assets - Liabilities 640,000 - 180,000 = P460,000 2. Net Income = Revenue - Expenses 560,000 - 460,000= P100,000 3. Liabilities = Assets - Owners Equity 840,000 - 500,000 = P340,000 4. Owners Equity = ( Beginning Capital + Income) - Drawing (460,000 + 100,000) - 60,000= P500,000 1-2 On March 1, 2020, Anthony Davis started his business, Davis Laundry Services, by investing cash of P 140,000. During the month, he earned service revenue on account, P 100,000. He also paid utilities expenses amounting to P 7,000; wages of P 20,000 and rent expense for the month of P 12,000. He later