Instructions Chart of Accounts 110 Cash 410 Sales Materials issued for the current month are as follows: 121 Accounts Receivable 610 Interest Revenue 125 Notes Receivable Job Requisition No. Material No. Amount 126 Interest Receivable EXPENSES 103 Plastic 400 $2,800 131 Materials 510 Cost of Goods Sold 24,000 520 Wages Expense 104 Steel 402 132 Work in Process 105 Glue Indirect 1,620 133 Factory Overhead 531 Selling Expenses 106 Rubber 403 3,200 134 Finished Goods 532 Insurance Expense 31,600 141 Supplies 533 Utilities Expense 107 Titanium 404 142 Prepaid Insurance 534 Office Supplies Expense 143 Prepaid Expenses 540 Administrative Expenses 181 Land 560 Depreciation Expense- 191 Factory Factory 192 Accumulated Depreciation- 590 Miscellaneous Expense Factory 710 Interest Expense Journal LIABILITIES 210 Accounts Payable Journalize the entry on Dec. 31 to record the issuance of materials. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for jounal 221 Utilities Payable explanations. Every line on a joumal page is used for debit or credit entries. CNOW jounals will automatically indent a credit entry when a credit amount is entered. 231 Notes Payable 236 Interest Payable 241 Lease Payable PAGE 10 251 Wages Payable JOURNAL 252 Consultant Fees Payable AcCOUNTING ENIATION DESCRIPTION Asse MBILITIES DATE POST. REF. DEBIT CREDIT EQUITY 1 EQUITY 2 311 Common Stock 3 340 Retained Eamings 351 Dividends
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
