Below are the Profit and Loss Statement and Balance Sheet for Keane Pte Ltd after 1 year of operations. Check and prepare the corrected classified Balance Sheet. Profit and Loss Statement as at 31 December 2021 $ $ $ Course Fees Revenue 25,700 Unearned Revenue 4,000 Sales Revenue 105,500 135,200 Less: Cost of Goods Sold 43,000 Gross Profit 92,200 Less: Operating Expense Selling Expense Salaries Expense (refer to Note 1) 55,000 Accrued Expense 1,000 56,000 General and Administrative Expense Salesmen Commission 15,500 Interest Expense 2,750 Roadshow Expense 19,000 Depreciation – Office Equipment 10,000 47,250 Financial Expense Prepaid Expense 13,100 Telephone Expense 2,400 15,500 118,750 Net Loss 26,550 Balance Sheet for the year ended 31 December 2021 Equity $ $ $ Capital 65,000 Less: Net Profit 26,550 Less: Drawings 7,000 31,450 Represented by: Current Assets Cash at Bank 27,200 Inventories 44,000 Creditors 27,350 Office Equipment 30,000 Add: Accumulated Depreciation – Office Equipment 10,000 40,000 138,550 Less: Current Liabilities Loan from OCBC (refer to Note 2) 40,000 Shares in Keppel 9,000 49,000 Working Capital 89,550 Non-Current Assets Accrued Revenue 600 Total Assets 90,150 Note 1: 10% of the salaries are for salesmen and the remaining are for office staff. Note 2: Bank loan of $5,000 is due on 17 August 2022. The balance is due on 25 June 2024. PLEASE ANSWER ACCORDING TO THE FORMAT BELOW: $ $ $
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.
Below are the
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Profit and Loss Statement as at 31 December 2021 |
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$ |
$ |
$ |
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Course Fees Revenue |
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25,700 |
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Unearned Revenue |
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4,000 |
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Sales Revenue |
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105,500 |
135,200 |
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Less: Cost of Goods Sold |
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43,000 |
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Gross Profit |
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92,200 |
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Less: Operating Expense |
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Selling Expense |
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Salaries Expense (refer to Note 1) |
55,000 |
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Accrued Expense |
1,000 |
56,000 |
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General and Administrative Expense |
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Salesmen Commission |
15,500 |
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Interest Expense |
2,750 |
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Roadshow Expense |
19,000 |
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10,000 |
47,250 |
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Financial Expense |
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Prepaid Expense |
13,100 |
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Telephone Expense |
2,400 |
15,500 |
118,750 |
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Net Loss |
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26,550 |
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Balance Sheet for the year ended 31 December 2021 |
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Equity |
$ |
$ |
$ |
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Capital |
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65,000 |
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Less: Net Profit |
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26,550 |
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Less: Drawings |
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7,000 |
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31,450 |
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Represented by: |
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Current Assets |
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Cash at Bank |
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27,200 |
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Inventories |
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44,000 |
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Creditors |
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27,350 |
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Office Equipment |
30,000 |
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Add: |
10,000 |
40,000 |
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138,550 |
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Less: Current Liabilities |
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Loan from OCBC (refer to Note 2) |
40,000 |
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Shares in Keppel |
9,000 |
49,000 |
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89,550 |
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Non-Current Assets |
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Accrued Revenue |
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600 |
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Total Assets |
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90,150 |
Note 1: 10% of the salaries are for salesmen and the remaining are for office staff.
Note 2: Bank loan of $5,000 is due on 17 August 2022. The balance is due on 25 June 2024.
PLEASE ANSWER ACCORDING TO THE FORMAT BELOW:
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