Directions for the rest of the adjusting enteries: Journalize the Closing Entries. (Do Not Post Them) Prepare a Schedule of Goods Available on January 31, 2022 Calculate for both Fifo and Lifo for the Month of January, 2022. (Use the Periodic Method) A. Ending Inventory B. Cost of Goods Sold Here are the adjusting Entries: Supplies on hand are valued at $1,400. Accrued salaries are $3,195. Depreciation for the month is $250. $2,250 of services related to the Unearned Service Revenue has not been earned by month end. Original Information: J & M Accounting Services and Office Supplies, LLC Trial Balance January 1, 2022 Title Debit Credit Cash 9,200 Accounts Receivable 2,400 Merchandise Inventory 2,100* Supplies 860 Equipment 23,000 Accumulated Depreciation 1,500 Accounts Payable 3,300 Unearned Service Revenue 3,600 Salaries and Wages Payable 2,485 Common Stock 20,000 Retained Earnings 6,675 Totals $37,560 $37,560 *(3,000 units at $0.70) During the month of January, the following summary transactions were completed. 3 Paid January’s rent $350. 3 Purchased merchandise on account from dd’s Discount Supply terms 2/10, n/30. (4,000 units @ $0.75) 4 Sold 4,400 units of inventory for Cash at $0.96 each. (3,000 @ $0.70 and 1,400 @ $0.75) 7 Gave a January 4th customer $192 for 200 units returned costing $150. (Units were returned to inventory.) 7 Received $2,000 cash from customers in payment of account. (No Discounts) 10 Paid $3,550 for salaries due employees, of which $2,485 is for December and $1,065 is for January. 11 Paid $2,800 on account. (No Discounts) 12 Paid dd’s Discount Supply in full, less discount. 13 Purchased 5,000 units for inventory on account from Office Headquarters at $0.80 each. Terms 2/10, n30. 14 Sold 4,000 units of inventory to customers on account at $0.99 per unit. Terms 2/10, n30. (Sold 2,800 units @ $0.75 and 1,200 units @ $0.80) 17 Received $5,450 Cash for services performed in January. 19 Purchased supplies on account $1,500. 24 Paid Salaries $3,550. 24 Received collections in full, less discount, from customers billed for sales on January 14th. Round to Whole Dollars. 28 Performed services on account and billed customers $2,180. 28 Paid Office Headquarters in full. (No discount). 31 Received $1,500 from customers for services to be performed in the future.
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.
Directions for the rest of the adjusting enteries:
- Journalize the Closing Entries. (Do Not Post Them)
- Prepare a Schedule of Goods Available on January 31, 2022
- Calculate for both Fifo and Lifo for the Month of January, 2022. (Use the Periodic Method)
A. Ending Inventory
B. Cost of Goods Sold
Here are the
- Supplies on hand are valued at $1,400.
- Accrued salaries are $3,195.
Depreciation for the month is $250.- $2,250 of services related to the Unearned Service Revenue has not been earned by month end.
Original Information:
J & M Accounting Services and Office Supplies, LLC
January 1, 2022
|
Title |
Debit |
Credit |
|
Cash |
9,200 |
|
|
|
2,400 |
|
|
Merchandise Inventory |
2,100* |
|
|
Supplies |
860 |
|
|
Equipment |
23,000 |
|
|
|
|
1,500 |
|
Accounts Payable |
|
3,300 |
|
Unearned Service Revenue |
|
3,600 |
|
Salaries and Wages Payable |
|
2,485 |
|
Common Stock |
|
20,000 |
|
|
|
6,675 |
|
Totals |
$37,560 |
$37,560 |
*(3,000 units at $0.70)
During the month of January, the following summary transactions were completed.
3 Paid January’s rent $350.
3 Purchased merchandise on account from dd’s Discount Supply terms 2/10, n/30. (4,000 units @ $0.75)
4 Sold 4,400 units of inventory for Cash at $0.96 each. (3,000 @ $0.70 and 1,400 @ $0.75)
7 Gave a January 4th customer $192 for 200 units returned costing $150. (Units were returned to inventory.)
7 Received $2,000 cash from customers in payment of account. (No Discounts)
10 Paid $3,550 for salaries due employees, of which $2,485 is for December and $1,065 is for January.
11 Paid $2,800 on account. (No Discounts)
12 Paid dd’s Discount Supply in full, less discount.
13 Purchased 5,000 units for inventory on account from Office Headquarters at $0.80 each. Terms 2/10, n30.
14 Sold 4,000 units of inventory to customers on account at $0.99 per unit. Terms 2/10, n30.
(Sold 2,800 units @ $0.75 and 1,200 units @ $0.80)
17 Received $5,450 Cash for services performed in January.
19 Purchased supplies on account $1,500.
24 Paid Salaries $3,550.
24 Received collections in full, less discount, from customers billed for sales on January 14th. Round to Whole Dollars.
28 Performed services on account and billed customers $2,180.
28 Paid Office Headquarters in full. (No discount).
31 Received $1,500 from customers for services to be performed in the future.
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