Construct an analysis of the following transaction and use the table: Assets = Liabilities + Owner's Equity Account title Debit Credit Account title Debit Credit Account title Debit Credit Mr. Garcia opened a medical practice, Garcia Cures. The following transactions happened in the first month of business. Date Transactions May 1 Garcia invested P30,000 cash to start his business. 2 Purchased medical supplies on account, P10,000. 2 Paid monthly office rent of P4,000. 3 Recorded P5,000 revenue for service rendered to patients: received cash of P2,000 and sent bills to patients for the remainder. 15 Borrowed P50,000 from the bank, signing a note payable 22 Performed service for patients on account, P3,600 30 Received cash from patients billed on September 3, P2,000 31 Received and paid a utility bill, P200 31 Paid monthly salary to nurses, P3,000 31 Paid interest expense of P200
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.
Construct an analysis of the following transaction and use the table:
| Assets | = | Liabilities | + | Owner's Equity | ||||||
| Account title | Debit | Credit | Account title | Debit | Credit | Account title | Debit | Credit |
Mr. Garcia opened a medical practice, Garcia Cures. The following transactions happened in the first month of business.
|
Date |
Transactions |
|
May 1 |
Garcia invested P30,000 cash to start his business. |
|
2 |
Purchased medical supplies on account, P10,000. |
|
2 |
Paid monthly office rent of P4,000. |
|
3 |
Recorded P5,000 revenue for service rendered to patients: received cash of P2,000 and sent bills to patients for the remainder. |
|
15 |
Borrowed P50,000 from the bank, signing a note payable |
|
22 |
Performed service for patients on account, P3,600 |
|
30 |
Received cash from patients billed on September 3, P2,000 |
|
31 |
Received and paid a utility bill, P200 |
|
31 |
Paid monthly salary to nurses, P3,000 |
|
31 |
Paid interest expense of P200 |
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