SEARCH ASK CHAT MATH SOLVER Question Jack Shellenkamp owns and manages a computer repair service, which had the following trial balance on December 31, 2009 (the end of its fiscal year) BYTE REPAIR SERVICE Trial Balance December 31, 2009 Cash $ 8,000 Accounts Receivable 15,000 Parts Inventory 13,000 Prepaid Rent 3,000 Shop Equipment 21,000 Accounts Payable $19,000 Jack Shellenkamp, Capital 41,000 $60,000 $60,000 Summarized transactions for January 2010 were as follows: 1. Advertising costs, paid in cash, $1,000. 2. Additional repair parts inventory acquired on account $4,000. 3. Miscellaneous expenses, paid in cash, $2,000. 4. Cash collected from customers in payment of accounts receivable $14,000. 5. Cash paid to creditors for accounts payable due $15,000. 6. Repair parts used during January $4,000. (Hint: Debit this to Repair Parts Expense.) 7. Repair services performed during January: for cash $6,000; on account $9,000. 8. Wages for January, paid in cash, $3,000. 9. Jack’s drawings during January were $3,000 (b) Prepare journal entries to record each of the January transactions. (Omit explanations.) (c) Post the journal entries to the accounts in the ledger. (Add accounts as needed.) (d) Prepare a trial balance as of January 31, 2010.
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.
Jack Shellenkamp owns and manages a computer repair service, which had the following
BYTE REPAIR SERVICE
Trial Balance
December 31, 2009
Cash $ 8,000
Parts Inventory 13,000
Prepaid Rent 3,000
Shop Equipment 21,000
Accounts Payable $19,000
Jack Shellenkamp, Capital 41,000
$60,000 $60,000
Summarized transactions for January 2010 were as follows:
1. Advertising costs, paid in cash, $1,000.
2. Additional repair parts inventory acquired on account $4,000.
3. Miscellaneous expenses, paid in cash, $2,000.
4. Cash collected from customers in payment of accounts receivable $14,000.
5. Cash paid to creditors for accounts payable due $15,000.
6. Repair parts used during January $4,000. (Hint: Debit this to Repair Parts Expense.)
7. Repair services performed during January: for cash $6,000; on account $9,000.
8. Wages for January, paid in cash, $3,000.
9. Jack’s drawings during January were $3,000
(b) Prepare
(c)
(d) Prepare a trial balance as of January 31, 2010.
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