Duerr Engineering completed the following transactions in the month of June. Using the following transactions, record journal entries, create financial statements, and assess the impact of each transaction on the financial statements. Jun. 1 Melanie Duerr, the owner, invested $150,000 cash, office equipment with a value of $17,500, and $85,000 of drafting equipment to launch the company. Jun. 2 The company purchased land worth $61,500 for an office by paying $23,800 cash and signing a long-term note payable for $37,700. Jun. 3 The company purchased a portable building with $42,500 cash and moved it onto the land acquired on June 2. Jun. 4 The company paid $10,500 cash for the premium on an 18-month insurance policy. Jun. 5 The company completed and delivered a set of plans for a client and collected $16,200 cash. Jun. 6 The company purchased $35,000 of additional drafting equipment by paying $22,000 cash and signing a long-term note payable for $13,000. Jun. 7 The company completed $34,000 of engineering services for a client. This amount is to be received in 30 days. Jun. 8 The company purchased $2,400 of additional office equipment on credit. Jun. 9 The company completed engineering services for $27,000 on credit. Jun. 10 The company received a bill for rent of equipment that was used on a recently completed job. The $2,550 rent cost must be paid within 30 days. Jun. 12 The company collected $17,000 cash in partial payment from the client billed on June 9. Jun. 14 The company paid $1,400 cash for wages to a drafting assistant. Jun. 17 The company paid $2,400 cash to settle the account payable created in on June 8. Jun. 20 The company paid $1,550 cash for minor maintenance of its drafting equipment. Jun. 23 Melanie Duerr withdrew $9,980 cash from the company for personal use. Jun. 28 The company paid $1,400 cash for wages to a drafting assistant. Jun. 29 The company paid $3,500 cash for advertisements on the web during June.
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.
Duerr Engineering completed the following transactions in the month of June.
Using the following transactions, record
| Jun. | 1 | Melanie Duerr, the owner, invested $150,000 cash, office equipment with a value of $17,500, and $85,000 of drafting equipment to launch the company. | ||
| Jun. | 2 | The company purchased land worth $61,500 for an office by paying $23,800 cash and signing a long-term note payable for $37,700. | ||
| Jun. | 3 | The company purchased a portable building with $42,500 cash and moved it onto the land acquired on June 2. | ||
| Jun. | 4 | The company paid $10,500 cash for the premium on an 18-month insurance policy. | ||
| Jun. | 5 | The company completed and delivered a set of plans for a client and collected $16,200 cash. | ||
| Jun. | 6 | The company purchased $35,000 of additional drafting equipment by paying $22,000 cash and signing a long-term note payable for $13,000. | ||
| Jun. | 7 | The company completed $34,000 of engineering services for a client. This amount is to be received in 30 days. | ||
| Jun. | 8 | The company purchased $2,400 of additional office equipment on credit. | ||
| Jun. | 9 | The company completed engineering services for $27,000 on credit. | ||
| Jun. | 10 | The company received a bill for rent of equipment that was used on a recently completed job. The $2,550 rent cost must be paid within 30 days. | ||
| Jun. | 12 | The company collected $17,000 cash in partial payment from the client billed on June 9. | ||
| Jun. | 14 | The company paid $1,400 cash for wages to a drafting assistant. | ||
| Jun. | 17 | The company paid $2,400 cash to settle the account payable created in on June 8. | ||
| Jun. | 20 | The company paid $1,550 cash for minor maintenance of its drafting equipment. | ||
| Jun. | 23 | Melanie Duerr withdrew $9,980 cash from the company for personal use. | ||
| Jun. | 28 | The company paid $1,400 cash for wages to a drafting assistant. | ||
| Jun. | 29 | The company paid $3,500 cash for advertisements on the web during June. |
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