Hawk Company uses a single-column purchases journal, a cash payments journal, and a general journal to record transactions with its suppliers and others. Record the following transactions in the appropriate journals. Transactions
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.
Hawk Company uses a single-column purchases journal, a cash payments journal, and a general journal to record transactions with its suppliers and others. Record the following transactions in the appropriate journals.
Transactions
Oct. 5 Purchased merchandise on account for $19,000 from Harrelson Company. Terms: 2/10, n/30; FOB shipping point.
Oct. 6 Paid $6,600 to Ken’s Insurance Company for a two-year fire insurance policy.
Oct. 8 Purchased store supplies on account for $600 from Stone Pony Supply Company. Terms: 2/10, n/30.
Oct. 11 Purchased merchandise on account for $15,000 from Steve Corporation. Terms: 2/10, n/30; FOB shipping point.
Oct. 13 Granted a reduction of $3,000 from Steve Corporation for merchandise purchased on October 11 and returned because of damage.
Oct. 15 Paid Harrelson Company for merchandise purchased on October 5, less discount.
Oct. 16 Purchased merchandise for $9,000 cash from Williams Company.
Oct. 21 Paid Steve Corporation for merchandise purchased on October 11, less merchandise returned on October 13, less discount.
Oct. 25 Purchased merchandise on account for $21,000 from Ozzle Company. Terms: 2/10, n/30; FOB shipping point.
Oct. 31 Purchased equipment for $27,000 cash from Guillen Office Supply Company.
HAWK COMPANY
Purchases Journal
P1
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Inventory Dr.
Date Account Credited Ref. Accounts Payable Cr.
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HAWK COMPANY
General Journal
G1
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Date Explanation Ref. Debit Credit
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HAWK COMPANY
Cash Payments Journal
CP1
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Other Accounts
Accounts Accounts Payable Inventory Cash
Date Debited Ref. Dr. Dr. Cr. Cr.
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