Debit Credit Debit Credit $ 3,090 Common Stock, no par (2,000 shares) Retained Earnings (1/1/2019) Dividends Cash $20,000 42,400 Accounts Receivable 9,900 Allowance for Doubtful $ 2,000 Accounts $ 100 Inventory Sales Revenue 17,750 1,400 9,000 42,000 69,700 Supplies Land Cost of Goods Sold Salaries Expense Advertising Expense Other Expenses 36,860 12,500 8,100 4,500 Buildings and Equipment Accumulated Depreciation Accounts Payable 4,200 10,700 During the month of December, Davis entered into the following transactions: Date Transaction Made cash sales of $3,000; the cost of the inventory sold was $1,800. Purchased $2,400 of inventory on credit. Collected $900 of accounts receivable. Dec. 7 14 18 Sold land for $7,800; the land originally cost $5,000. Made credit sales of $4,000; the cost of the inventory sold was $2,400. Returned $360 of defective inventory to supplier for credit to the Davis Company's account. Purchased $1,250 of inventory for cash. Paid $1,100 of accounts payable. Purchased land at a cost of $6,000; made a $1,000 down payment and signed a 12%, 2-year note for the balance. 20 21 27 28 31
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.
On November 30, 2019, Davis Company and the following account balances:
1. Prepare general
2. Post to general ledger T-accou11ts.
3. Prepare a year-end
4. Prepare company's financial statements for 2019 .
5. Prepare 2019 (a) adjusting and (b) closing entries in the general journal.
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