PART A The following list of balances was extracted from the books of Kai Jordan at 31 December 2020, the sole trader’s year end date. The bookkeeper was unable to extract the figure for the Capital account before catching the flu and having to take sick leave. However, the bookkeeper assured that all the other account balances are correct, which means that extracting trial balance will be able to solve the 'missing' Capital account balance. Capital ? Accounts payables 89,244 Accounts receivables 102,432 Accruals 14,136 Bad debts expense 17,076 Bank 26,952 Carriage in 6,624 Carriage out 8,544 Closing stock 53,880 Commissions received 1,824 Depreciation expense 79,824 Discounts allowed 22,380 Discounts received 9,300 Drawings 90,000 Equipment 540,000 Insurance 21,024 Interest expense 8,520 Loan 150,000 Motor Vehicles 180,000 Opening stock 47,700 Other payables 7,920 Prepayments 6,384 Provision for depreciation - Equipment 162,000 Provision for depreciation - Motor Vehicles 72,000 Provision for doubtful debts 1,140 Purchases 594,960 Returns in 3,096 Returns out 4,020 Sales 853,740 Telephone 24,792 Water rates 15,540 Required For the list of balances above, you are required to: a) Extract a trial balance from the above list of balances (filling in the correct Capital figure)
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.
PART A
The following list of balances was extracted from the books of Kai Jordan at 31 December 2020, the sole trader’s year end date. The bookkeeper was unable to extract the figure for the Capital account before catching the flu and having to take sick leave. However, the bookkeeper assured that all the other account balances are correct, which means that extracting
|
Capital |
? |
|
Accounts payables |
89,244 |
|
Accounts receivables |
102,432 |
|
Accruals |
14,136 |
|
|
17,076 |
|
Bank |
26,952 |
|
Carriage in |
6,624 |
|
Carriage out |
8,544 |
|
Closing stock |
53,880 |
|
Commissions received |
1,824 |
|
|
79,824 |
|
Discounts allowed |
22,380 |
|
Discounts received |
9,300 |
|
Drawings |
90,000 |
|
Equipment |
540,000 |
|
Insurance |
21,024 |
|
Interest expense |
8,520 |
|
Loan |
150,000 |
|
Motor Vehicles |
180,000 |
|
Opening stock |
47,700 |
|
Other payables |
7,920 |
|
Prepayments |
6,384 |
|
Provision for depreciation - Equipment |
162,000 |
|
Provision for depreciation - Motor Vehicles |
72,000 |
|
Provision for doubtful debts |
1,140 |
|
Purchases |
594,960 |
|
Returns in |
3,096 |
|
Returns out |
4,020 |
|
Sales |
853,740 |
|
Telephone |
24,792 |
|
Water rates |
15,540 |
Required
For the list of balances above, you are required to:
a) Extract a trial balance from the above list of balances (filling in the correct Capital figure)
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