Exercise 2 Cash Accounts Receivable Notes Receivable Merchandise Inventory Prepaid Insurance Office Supplies Delivery Equipment Nogi Company Trial Balance December 31, 2019 Accumulated Depreciation - Delivery Equipment Furniture and Fixtures Accumulated Depreciation - Furniture and Fixture Accounts Payable Notes Payable N, Capital N, Drawing Sales Sales Returns and Allowances Purchases Purchase Returns and Allowances Freight-in Rent Expense Commissions Expense Utilities Expense Office Supplies Expense Delivery Expense Totals Debit P237,000 59,400 39,600 247,500 12,000 30,000 225,000 180,000 50,000 195,000 1,125,000 12,000 170,000 300,000 37,500 25,000 18,000 P2,963,000 Credit b. Insurance expired during the year is P6,000. c. Unpaid commissions during the year amounted to P66,000. d. Ending Inventory amounted to P 450,000. e. Unpaid salaries amounted to P 54,000. f. Uncollectible accounts at year-end are estimated to be 13,500. P54,000 45,000 45,000 105,000 324,000 2,300,000 90,000 P2.963.000 Additional pieces of information determined for December 31, 2019 are as follows: a. Depreciation of delivery equipment is P18,000 and that of Furniture and Fixture is P22,500. Reqmts: Adj Entries, Worksheet and Closing entries.
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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