The balances of the ledger accounts of Beldren Home Center as of December 31, the end of its fiscal year, are as follows: Cash $ 10,628 Accounts Receivable 43,939 Merchandise Inventory 120,369 Supplies 1,577 Prepaid Insurance 2,605 Store Equipment 35,824 Accumulated Depreciation, Store Equipment 29,632 Office Equipment 10,536 Accumulated Depreciation, Office Equipment 1,731 Notes Payable 5,003 Accounts Payable 29,756 Unearned Rent 3,230 A. P. Beldren, Capital 117,275 A. P. Beldren, Drawing 28,812 Sales 655,150 Sales Returns and Allowances 9,732 Purchases 518,987 Purchases Returns and Allowances 12,437 Purchases Discounts 8,678 Freight In 24,820 Wages Expense 54,288 Interest Expense 775 Data for the adjustments are as follows: a-b. Merchandise Inventory at December 31, $101,887. c. Wages accrued at December 31, $1,828. d. Supplies inventory (on hand) at December 31, $644. e. Depreciation of store equipment, $5,738. f. Depreciation of office equipment, $1,809. g. Insurance expired during the year, $846. h. Rent earned, $2,485.
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.
The balances of the ledger accounts of Beldren Home Center as of December 31, the end of its fiscal year, are as follows:
| Cash | $ 10,628 |
| 43,939 | |
| Merchandise Inventory | 120,369 |
| Supplies | 1,577 |
| Prepaid Insurance | 2,605 |
| Store Equipment | 35,824 |
| Accumulated |
29,632 |
| Office Equipment | 10,536 |
| Accumulated Depreciation, Office Equipment | 1,731 |
| Notes Payable | 5,003 |
| Accounts Payable | 29,756 |
| Unearned Rent | 3,230 |
| A. P. Beldren, Capital | 117,275 |
| A. P. Beldren, Drawing | 28,812 |
| Sales | 655,150 |
| Sales Returns and Allowances | 9,732 |
| Purchases | 518,987 |
| Purchases Returns and Allowances | 12,437 |
| Purchases Discounts | 8,678 |
| Freight In | 24,820 |
| Wages Expense | 54,288 |
| Interest Expense | 775 |
Data for the adjustments are as follows:
| a-b. | Merchandise Inventory at December 31, $101,887. |
| c. | Wages accrued at December 31, $1,828. |
| d. | Supplies inventory (on hand) at December 31, $644. |
| e. | Depreciation of store equipment, $5,738. |
| f. | Depreciation of office equipment, $1,809. |
| g. | Insurance expired during the year, $846. |
| h. | Rent earned, $2,485. |
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