Comprehensive Problem Prepare adjusting entries, post to ledger accounts, and prepare adjusted trial balance. Ben and Jerry started his own consulting firm, on June 1, 2021. The trial balance at June 30 is as follows. Ben & Jerry Consultants Trial Balance June 30, 2021 Debit Credit Cash $ 6,850 Accounts Receivable 7,000 Supplies 2,000 Prepaid Insurance 2,880 Equipment 15,000 Accounts Payable $ 4,230 Unearned Service Revenue 5,200 Common Stock 22,000 Service Revenue 8,300 Salaries and Wages Expense 4,000 Rent Expense 2,000 $39,730 $39,730 1.Supplies on hand at June 30 total $720. 2.A utility bill for $180 has not been recorded and will not be paid until next month. 3.The insurance policy is for a year. 4.Services were performed for $4,100 of unearned service revenue by the end of the month. 5.Salaries of $1,250 are accrued at June 30. 6.The equipment has a 5-year life with no salvage value and is being depreciated at $250 per month for 60 months. 7.Invoices representing $3,900 of services performed during the month have not been recorded as of June 30. Instructions (a) Prepare the adjusting entries for the month of June. (b) Post the adjusting entries to the ledger accounts. Enter the totals from the trial balance as beginning account balances. (Use T-accounts.) (c) Prepare an adjusted trial balance at June 30, 2021
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.
Comprehensive Problem
Prepare
Ben and Jerry started his own consulting firm, on June 1, 2021. The trial balance at June 30 is as
follows.
Ben & Jerry Consultants
Trial Balance
June 30, 2021
Debit Credit
Cash $ 6,850
Accounts Receivable 7,000
Supplies 2,000
Prepaid Insurance 2,880
Equipment 15,000
Accounts Payable $ 4,230
Unearned Service Revenue 5,200
Common Stock 22,000
Service Revenue 8,300
Salaries and Wages Expense 4,000
Rent Expense 2,000
$39,730 $39,730
1.Supplies on hand at June 30 total $720.
2.A utility bill for $180 has not been recorded and will not be paid until next month.
3.The insurance policy is for a year.
4.Services were performed for $4,100 of unearned service revenue by the end of the
month.
5.Salaries of $1,250 are accrued at June 30.
6.The equipment has a 5-year life with no salvage value and is being
per month for 60 months.
7.Invoices representing $3,900 of services performed during the month have not been
recorded as of June 30.
Instructions
(a) Prepare the adjusting entries for the month of June.
(b) Post the adjusting entries to the ledger accounts. Enter the totals from the trial
balance as beginning account balances. (Use T-accounts.)
(c) Prepare an adjusted trial balance at June 30, 2021
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