Listed below are the Feb. 1, 2016 account balances of the Teresita Buenaflor Shoes: 110 Cash 120 P 33,000 Accounts Receivable Merchandise Inventory Supplies Prepaid Insurance Land Building Accumulated Depreciation-Building Equipment Accuimulated Depreciation-Equipment Accounts Payable Salaries Payable Mortgage Payable Buenaflor, Capital Buenaflor, Withdrawals Income Summary 192,000 130 140 413,000 51,000 48,000 460,000 1,750,000 150 160 170 175 P 350,000 180 2,310,000 185 630,000 108,000 210 220 230 310 320 2,600,000 1,569,000 330 410 420 Sales Sales Returns and Allowances 430 510 Sales Discounts Purchases Purchases Returns and Allowances 520 530 Purchases Discounts Transportation In Salaries Expense Supplies Expense Insurance Expense Depreciation Expense-Building Depreciation Expense-Equipment Transportation Out Advertising Expense Interest Expense Miscellaneous Expense 540 610 620 630 640 650 660 670 680 690 P5,257,000 P5,257,000 During the month of February 2016, the following transactions occurred: Feb. 1 Collected P113,000 from customers on account. 2 Paid P64,000 of accounts due less discounts of 3%. Purchased merchandise, P170,000. Terms: FOB shipping point; 3/10, n/30. Sold merchandise on account to Gonzales Inc., P270,000. Terms: FOB shipping point; 2/10, n/30. 4. 267
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.
Prepare the closing entries and post closing
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