FINANCIAL ACCOUNTING ONE CAT I QUESTION ONE Juan Cruz began professional practice as a system analyst on July 1. He plans to prepare a monthly financial statement. During July, the owner completed these transactions July 1. Owner invested sh 500,000 cash along with computer equipment that had a market value of php. 120,000 July 2. Paid sh. 15,000 cash for the rent of office space for the month. July 4. Purchased sh 12,000 of additional equipment on credit (due within 30 days). July 8. He completed a work for Mr. Patrick and immediately he was paid the sh. 32,000 cash. July 10. Completed work for Mr. simon and sent a bill for sh. 27,000 to be paid within 30 days. July 12. Purchased additional equipment for sh. 8,000 in cash. July 15. Paid assistant sh. 6,200 cash as wages for 15 days. July 18. Collected sh. 15,000 on the amount owed by Mr. simon. July 25. Paid sh 12,000 cash to settle the liability on the equipment purchased. July 28. Owner withdrew sh. 500 cash for personal use. July 30. Completed work for Miss Akinyi who paid only sh. 40,000 for 50% of the system design. July 31. Paid salary of assistant sh.700. July 31. Received water bill, sh. 1,800 and telephone bill sh. 3,800. Required: i) The journal entries ii) Ledger accounts iii) Trial balance for this business.
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.
FINANCIAL ACCOUNTING ONE
CAT I
QUESTION ONE
Juan Cruz began professional practice as a system analyst on July 1. He plans to prepare a monthly financial statement. During July, the owner completed these transactions
July 1. Owner invested sh 500,000 cash along with computer equipment that had a market value of php. 120,000
July 2. Paid sh. 15,000 cash for the rent of office space for the month.
July 4. Purchased sh 12,000 of additional equipment on credit (due within 30 days).
July 8. He completed a work for Mr. Patrick and immediately he was paid the sh. 32,000 cash.
July 10. Completed work for Mr. simon and sent a bill for sh. 27,000 to be paid within 30 days.
July 12. Purchased additional equipment for sh. 8,000 in cash.
July 15. Paid assistant sh. 6,200 cash as wages for 15 days.
July 18. Collected sh. 15,000 on the amount owed by Mr. simon.
July 25. Paid sh 12,000 cash to settle the liability on the equipment purchased.
July 28. Owner withdrew sh. 500 cash for personal use.
July 30. Completed work for Miss Akinyi who paid only sh. 40,000 for 50% of the system design.
July 31. Paid salary of assistant sh.700.
July 31. Received water bill, sh. 1,800 and telephone bill sh. 3,800.
Required:
- i) The
journal entries - ii) Ledger accounts
iii)
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