Epicenter Laundry Unadjusted Trial Balance June 30, 20Y3 Debit Balances Credit Balances Cash.. . Laundry Supplies... Prepald Insurance... Laundry Equipment.. Accumulated Depreclation.. Accounts Payable... Sophle Perez, Capital... Sophie Perez, Drawing.. Laundry Revenue.... 11,000 21,500 9,600 232,600 125,400 11,800 105,600 10,000 232,200 Wages Expense... Rent Expense.... Utilities Expense.... Miscellaneous Expense.. 125,200 40,000 19,700 5,400 475,000 475,000
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.
- Laundry supplies on hand at June 30 are $3,600.
- Insurance premiums expired during the year are $5,700.
Depreciation of laundry equipment during the year is $6,500.- Wages accrued but not paid at June 30 are $1,100.
Instructions
- For each account listed in the unadjusted
trial balance , enter the balance in a T account. Identify the balance as “June 30 Bal.” In addition, add T accounts for Wages Payable, Depreciation Expense, Laundry Supplies Expense, and Insurance Expense. - Journalize and post the
adjusting entries . Identify the adjustments as “Adj.” and the new balances as “Adj. Bal.” - Prepare an adjusted trial balance.
- Prepare an income statement, a statement of owner’s equity (no additional investments were made during the year), and a balance sheet.
- Journalize and
post the closing entries. Identify the closing entries as “Clos.” - Prepare a post-closing trial balance.
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 9 images
