Business tran saction Jan 1 started business with RM 20000 cash. 2 Purchased furniture worth RM 5000 by cash Feb 2 Purchased goods worth RM 1000 by cash at a 10% trade discount. Bought goods on credit from ABC Bhd for RM390 and XY trading for RM710 4 7 Made RM500 cash sales to J Made RM7000 cash sales to M with 15% trade discount. The cost of sale was RM 1500 March 4 Sold goods worth RM1,200 and RM 900 on credit to Ting and Ming respectively. The cost of sale was Rm 200 and Rm 100 26 April 11 Received RM 900 from Ming June 16 Received RM1200 from Ting with 5% cash discount July 14 Paid RM 390 to ABC bhd Paid RM 710 to XY Trading with 10% cash discount August 16 Office equipments RM 350 purchased 27 The owner invested 10000 cash as capital into the business Sept 17 owner withdrew RM 550 for personal use 30 Made cash sales RM 4500.The cost of sale was RM 700 October 20 Rent of RM 2000 received from Joe Jonas. November 22 Telephone bill of RM200 is paid December 24 Paid RM1200 for utilities 26. Wages of RM 20000 paid 28 Paid RM 300 for a rental car for delivery of shoes Additional info : assets business own 1) Building -RM 74500, 5% Per annum, straight line method wwww 2) Motor vehicle - RM 35000,5 years useful life, 17000 scrap value USE PERPETUAL INVENTORY SYSTEM A. Prepare journal entries and post it to ledgers (ledgers should be in colums, example is provided, should not be in Taccount format B.Create your own balance C.Calculate depreciation for the year D.Estimate allowance for trade receivables (why?) E. Prepare trial balance E.Prepare statement of profit or loss F.Prepare statement of financtal position
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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