Alena Co. was organized on July 1, 2017. Quarterly financial statements are prepared. The unadjusted and adjusted trial balances as of September 30 are shown below. ALENA CO. Trial Balance September 30, 2017 Unadjusted Adjusted Dr. Cr. Dr. Cr. Cash 9,500 9,500 Accounts Receivable 11,500 12,700 Supplies 1,700 750 Prepaid Rent 2,300 600 Equipment 20,000 20,000 Accumulated Depreciation—Equipment 0 800 Notes Payable 11,000 11,000 Accounts Payable 2,700 2,700 Salaries and Wages Payable 0 850 Interest Payable 0 150 Unearned Rent Revenue 2,000 550 Owner’s Capital 23,000 23,000 Owner’s Drawings 1,900 1,900 Service Revenue 17,000 18,200 Rent Revenue 1,510 2960 Salaries and Wages Expense 7,000 7850 Rent Expense 1,900 3,600 Depreciation Expense 800 Supplies Expense 950 Utilities Expense 1,410 1,410 Interest Expense 150 Total 57,210 57,210 60,210 60,210 Instructions (a)Journalize the adjusting entries that were made. (b) If the note bears interest at 10%, how many months has it been outstanding?
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
. Alena Co. was organized on July 1, 2017. Quarterly financial statements are prepared. The unadjusted
and adjusted
ALENA CO.
Trial Balance
September 30, 2017
Unadjusted Adjusted
Dr. Cr. Dr. Cr.
Cash 9,500 9,500
Accounts Receivable 11,500 12,700
Supplies 1,700 750
Prepaid Rent 2,300 600
Equipment 20,000 20,000
Accumulated
Notes Payable 11,000 11,000
Accounts Payable 2,700 2,700
Salaries and Wages Payable 0 850
Interest Payable 0 150
Unearned Rent Revenue 2,000 550
Owner’s Capital 23,000 23,000
Owner’s Drawings 1,900 1,900
Service Revenue 17,000 18,200
Rent Revenue 1,510 2960
Salaries and Wages Expense 7,000 7850
Rent Expense 1,900 3,600
Depreciation Expense 800
Supplies Expense 950
Utilities Expense 1,410 1,410
Interest Expense 150
Total 57,210 57,210 60,210 60,210
Instructions
(a)Journalize the
(b) If the note bears interest at 10%, how many months has it been outstanding?
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