This information relates to Pharoah Co. 1. On April 5, purchased merchandise on account from Flounder Company for $26,100, terms 4/10, net/30, FOB shipping point. 2. On April 6, paid freight costs of $950 on merchandise purchased from Flounder Company. 3. On April 7, purchased equipment on account for $30,400. 4. On April 8, returned some of April 5 merchandise, which cost $3,700, to Flounder Company. 5. On April 15, paid the amount due to Flounder Company in full.
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.
HOW DO I PREPARE THE JOURNAL ENTRIES TO RECORD THESE TRANSACTIONS ?
This information relates to Pharoah Co.
| 1. | On April 5, purchased merchandise on account from Flounder Company for $26,100, terms 4/10, net/30, FOB shipping point. | |
| 2. | On April 6, paid freight costs of $950 on merchandise purchased from Flounder Company. | |
| 3. | On April 7, purchased equipment on account for $30,400. | |
| 4. | On April 8, returned some of April 5 merchandise, which cost $3,700, to Flounder Company. | |
| 5. | On April 15, paid the amount due to Flounder Company in full. |
- Accounts Payable
- Accounts Receivable
Accumulated Depreciation -Buildings- Accumulated Depreciation-Equipment
- Advertising Expense
- Buildings
- Cash
- Casuality Loss from Vandalism
- Cost of Goods Sold
- Depreciation Expense
- Dividend Revenue
- Equipment
- Freight-In
- Freight-Out
- Income Summary
- Insurance Expense
- Interest Expense
- Interest Payable
- Interest Revenue
- Inventory
- Land
- Loss on Disposal of Plant Assets
- Maintenance and Repairs Expense
- Notes Payable
- Operating Expenses
- Owner's Capital
- Owner's Drawings
- Prepaid Insurance
- Property Tax Expense
- Property Taxes Payable
- Purchase Discounts
- Purchase Returns and Allowances
- Purchases
- Rent Expense
- Salaries and Wages Expense
- Salaries and Wages Payable
- Sales Commissions Expense
- Sales Commissions Payable
- Sales Discounts
- Sales Returns and Allowances
- Sales Revenue
- Supplies
- Supplies Expense
- Unearned Service Revenue
- Utilities Expense
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