Problem 2. Adjustments Please present the adjusting entry for December 31, 2019 and the reversing entry as of January 1, 2020, based on the information below. (Each question is not related) The balance in the trial balance for several related accounts is as follows Supplies IDR 8,000,000 Prepaid rent 2,400,000 Unerned revenue 3,500,000 Advertising expense 4,000,000 At the end of the year, it is known that the services that have been provided to customers are 40% of the total revenue previously received The company has 20 employees who are paid every Saturday. Salary Rp. 110,000 per day per employee, Sunday is a holiday, December 31 is Wednesday. The balance of supplies in the trial balance is IDR 5,000,000. At the end of the year it is known that 30% of the company's supplies remain. Advertising expense is a payment for 10 advertisements in the shop. Until December 31, 2019 in the amount of IDR 12,000,000, ads that have not been shown. The company has provided services to customers amounting to Rp. 40,800,000, but has not received payment and has not recorded it. The recorded room rental is the rental for 3 months per November 1, 2019-January 31, 2020
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.
Problem 2. Adjustments
Please present the
The balance in the
Supplies IDR 8,000,000
Prepaid rent 2,400,000
Unerned revenue 3,500,000
Advertising expense 4,000,000
- At the end of the year, it is known that the services that have been provided to customers are 40% of the total revenue previously received
- The company has 20 employees who are paid every Saturday. Salary Rp. 110,000 per day per employee, Sunday is a holiday, December 31 is Wednesday.
- The balance of supplies in the trial balance is IDR 5,000,000. At the end of the year it is known that 30% of the company's supplies remain.
- Advertising expense is a payment for 10 advertisements in the shop. Until December 31, 2019 in the amount of IDR 12,000,000, ads that have not been shown.
- The company has provided services to customers amounting to Rp. 40,800,000, but has not received payment and has not recorded it.
- The recorded room rental is the rental for 3 months per November 1, 2019-January 31, 2020
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