he following year-end information is taken from the December 31 adjusted trial balance and oth ompany. Advertising expense Depreciation expense-Office equipment Depreciation expense-Selling equipment Depreciation expense-Factory equipment Raw materials purchases (all direct materials) Maintenance expense-Factory equipment Factory utilities Direct labor Indirect labor $ 63,000 42,000 43,000 85,000 950,000 46,500 40,000 540,000 81,000
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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The following year-end information is taken from the December 31 adjusted trial balance and other records of Leone
Company.
Advertising expense
Depreciation expense-Office equipment
Depreciation expense-Selling equipment
Depreciation expense-Factory equipment
Raw materials purchases (all direct materials)
Maintenance expense-Factory equipment
Factory utilities
Direct labor
Indirect labor
Office salaries expense
Rent expense-Office space
Rent expense-Selling space
Rent expense-Factory building
Sales salaries expense
Costs
1. Advertising expense
2. Depreciation expense-Office equipment
3. Depreciation expense-Selling equipment
4. Depreciation expense-Factory equipment
5. Raw materials purchases (all direct materials)
6. Maintenance expense-Factory equipment
$ 63,000
42,000
43,000
85,000
950,000
46,500
40,000
Required:
Identify each cost as either a product cost or a period cost. If a product cost, classify it as direct materials, direct labor, or factory
overhead. If a period cost, classify it as a selling expense or a general and administrative expense. (Leave no cell blank. Enter "NA -
Not a product cost" or "NA - Not a period cost" for expenses that are not product cost or period cost.)
7. Factory utilities
8. Direct labor
9. Indirect labor
10. Office salaries expense
11. Rent expense-Office space
12. Rent expense-Selling space
13. Rent expense-Factory building
14. Sales salaries expense
540,000
81,000
49,000
29,000
70,000
168,000
403,000
Type of Product Cost
Type of Period Cost](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F96ccea39-6e20-4e83-b9fb-b22d2ae10407%2F9397b0e3-2f4f-490c-a0e0-9c54a4d27913%2F6tfro8f_processed.png&w=3840&q=75)
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