following transactions occurred, and the accountant asked your help in determining whether they should be recorded or not. For each of the transactions below, specify whether the item in question should be included in ending inventory, and if so, at what amount. (a) (b) (c) On February 26, Houghton shipped goods costing $1,000 to a customer and charged the customer $1,250. The goods were shipped with terms FOB shipping point and the receiving report indicates that the customer received the goods on March 2. (d) (e) On February 26, Crain Inc. shipped goods to Houghton under terms FOB shipping point. The invoice price was $550 plus (f) $20 for freight. The receiving report indicates that the goods were received by Houghton on March 2. Houghton had $770 of inventory isolated in the warehouse. The inventory is designated for a customer who has requested that the goods be shipped on March 10. (8) Also included in Houghton's warehouse is $750 of inventory that Korenic Producers shipped to Houghton on consignment. On February 26, Houghton issued a purchase order to acquire goods costing $950. The goods were shipped with terms FOB destination on February 27. Houghton received the goods on March 2 On February 26, Houghton shipped goods to a customer under terms FOB destination. The invoice price was $360; the cost of the items was $250. The receiving report Indicates that the goods were received by the customer on March 2 Houghton had damaged goods set aside in the warehouse because they are no longer saleable. These goods originally cost $500, and Houghton had expected to sell these items for $700. Included Not Included $ 114
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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