BRADLEY IRRIGATION SYSTEM Adjusted Trial Balance December 31, 2018 Balance Account Title Debit Credit Cash $ 12,000 Accounts Receivable 51,000 Office Supplies 28,300 Prepaid Insurance 4,700 Building 57,300 Accumulated Depreciation-Building $ 25,300 Equipment 21,000 Accumulated Depreciation-Equipment 6,800 Accounts Payable 40,700 Interest Payable 2,000 Salaries Payable 3,500 Unearned Revenue 1,800 Notes Payable (long-term) 21,000 Common Stock 13,000 Retained Earnings 32,000 Dividends 3,200 Service Revenue 56,000 Insurance Expense 1,200 Salaries Expense 16,200 Supplies Expense 1,400 Interest Expense 2,000 Depreciation Expense-Building 1,200 Depreciation Expense-Equipment 2,600 Total $ 202,100 $ 202,100
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.
Preparing financial statements including a classified
The adjusted
Requirements
- Prepare the company’s income statement for the year ended December 31, 2018.
- Prepare the company’s statement of
retained earnings for the year ended December 31, 2018. - Prepare the company’s classified balance sheet in report form at December 31, 2018.
- Journalize the closing entries for Bradley Irrigation System.
- Compute the company’s current ratio at December 31, 2018. At December 31, 2017, the current ratio was 1.7. Did the company’s ability to pay current debts improve or deteriorate, or did it remain the same?
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 3 images
