Carmen Camry operates a consulting firm called Help Today, which began operations on August 1. On August 31, the company's records show the following accounts and amounts for the month of August. Cash Accounts receivable office supplies Land office equipment Accounts payable Dividends $25,260 Consulting fees earned 22,270 Rent expense. 5,130 Salaries expense 43,930 Telephone expense: 19,900 Miscellaneous expenses 10, 780 Common stock 5,890 $ 26,910 9,440 5,500 750 420 100, 800 Exercise 2-16 Preparing an Income statement LO C3, P3 Use the above information to prepare an August income statement for the business.
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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Use the following information for the Exercises below.
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Carmen Camry operates a consulting firm called Help Today, which began operations on August 1. On August 31, the
company's records show the following accounts and amounts for the month of August.
Cash
Accounts receivable
Office supplies
Land
office equipment
Accounts payable
Dividends
$25,260 Consulting fees earned
22,270 Rent expense.
5,130 Salaries expense
43,930 Telephone expense -
19,900 Miscellaneous expenses.
10, 780 Common stock
5,890
$ 26,910
9,440
5,500
750
420
100, 800
Exercise 2-16 Preparing an income statement LO C3, P3
Use the above information to prepare an August income statement for the business.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdc860f7d-8144-482b-af65-d08d28366106%2F8dd857de-4ba9-449b-83dd-f913cff8ee3a%2Fve0wtmb_processed.jpeg&w=3840&q=75)
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