Due Transocion Ap I Prchaed a delivery von for S10.000, poying $1,000 dowm, and ising a lyer, 12% note poyoble for the $9,000 balonce. is estimated thar the von has a dyear ife ond on $800 residual value he compony ves stroightline depreciation. The interest on the note will be paid on the maturity date. May 15 Prchased sa00 ol olice spplies. June 2 Purchased a 2 year comprehensive insuronce policy for $96o. Aug Sept. 15 Advanced S000 to sales personnel to cover their fuure rovel cos. 1 Becelved 6 monh et in advance $200 per monh ond econded the S1,500 receipt es Reed Revene. 1 Accepted o $6.0, 6monh, 12% jannal rate) note receivoble from a customer, he intere to be collected Nov. when the note is collected.
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 following information also is available:
1. On january 1, the office supplies account had a $250 balance.Om December 31,an inventory count showed $190 of office supplies on hand.
2.The weekly(5 day) payroll of Ardery Company amounts to $2,000.All employees are paid at the close of business each Wednesday.A 2-day accural is required for the current year.
3.Sales personnel travel cost reports indicate that $490 of advances had been used to pay travel expenses.
4. The income tax rate is 30% on current income and us payable in the first quarter of next year.The prtax income before the adjusting entries is $8,665.
Required:
On the basis of the above information, prepare journal entries to record whatever adjustment are necessary to bring the accounts up to date one December 31.each
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
