Following are the transactions of a Merchandise business. Product Desktop computer Table computer Landline telephone 4-in-1 desktop printer Date 2022 March 1 March 7 March 17 April 1 April 10 May 1 May 8 June 1 June 6 June 10 June 15 Cost price per unit $400 $60 $60 $100 Transactions California Business Solution purchases 10 electronic hardware packages at a cost of $620 each by paying cash. CBS purchases 30 desktop computers on credit at a cost of $400 each. The credit terms are n/15 with an invoice date of April 7. CBS makes full payment on the amount due from the April 7 purchase CBS purchases 67 tablet computers at a cost of $60 each on credit. The payment terms are 5/10, n/30, and the invoice is dated May 1. CBS pays their account in full. CBS purchased 300 landline telephones with cash at a cost of $60 each. On June 3, CBS discovers that 25 of the phones are the wrong color and returns the phones to the manufacturer for a full refund.. CBS discovers that 60 more phones from the June 1 purchase are slightly damaged. CBS decides to keep the phones but receives a purchase allowance from the manufacturer of $8 per phone. CBS purchases 80 units of the 4-in-1 desktop printers at a cost of $100 each on credit. Terms of the purchase are 5/15, n/40, with an invoice date of July 1. CBS discovers 15 of the printers are damaged and returns them to the manufacturer for a full refund. CBS discovers that 4 more printers from the July 1 purchase are slightly damaged but decides to keep them, with the manufacturer issuing an allowance of $30 per printer. CBS pays their account in full, less purchase returns and allowances. Required Prepare journal entries by using perpetual inventory system
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.
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