Account Titie and Explanation Debit Credit Cash P10,060 Accounts Receivable 2,000 Prepaid Expenses 7,800 Supplies Office Equipment 1,460 26,400 Accum. Depreciation Eqpt. Notes Payable 16,000 Interest Payable Unearned Service Revenue 15,020 Lester Rome, Capital 22,000 Lester Rome, Withdrawal 3,000 Service Revenue 1,580 Supplies Expense 2,680 Salaries Expense 1,200 P54,600 P54,600 More information: No interest has yet been paid on the note payable. It bears 10% interest per annum payable for 1 year. Salaries earned by the office staff but not yet recorded or paid amounted to P970 by April 30. Many clients are asked to make advance payment for accounting services to be rendered in future months. During April, P5,020 of these advances were earned by the business. Office Supplies on hand by April 30 amounted to P400. The office equioment was acquired on April 1 and is being depreciated over an estimated useful life of 10 years with no residual value. The company sets up 1% provision for total collectible. equired: Prepare the adjusting entries
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.
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