Lion Consulting Adjusted Trial Balance June 30, 2019 Debit Balances Credit Balances Cash 92,000 Accounts Receivable 450,000 Merchandise Inventory 370,000 Estimated Returns Inventory 5,000 Office Supplies 10,000 Prepaid Insurance 12,000 Office Equipment 220,000 Accumulated Depreciation - Office Equip. 58,000 Store Equipment 650,000 Accumulated Depreciation - Store Equip. 87,500 Accounts Payable 38,500 Customer Refunds Payable 10,000 Salaries Payable 4,000 Note Payable (final payment due 2029)* *140,000 M.T. Lion, Capital 431,000 M.T. Lion, Drawing 300,000 Sales 8,925,000 Cost of Merchandise Sold 5,620,000 Sales Salary Expense 850,000 Advertising Expense 420,000 Depreciation Expense--Store Equipment 33,000 Miscellaneous Selling Expense 18,000 Office Salaries Expense 540,000 Rent Expense 48,000 Insurance Expense 24,000 Depreciation Expense--Office Equipment 10,000 Office Supplies Expense 4,000 Miscellaneous Administrative Expense 6,000 Interest Expense 12,000 Totals 9,694,000 9,694,000 *Note: The current portion of the note payable is $7,000. Use the Adjusted Trial Balance for Lion Consulting. On the Income Statement, what would the Net Income (or Net Loss) be for Lion Consulting? Group of answer choices $1,364,000 $1,340,000 $1,352,000 $8,925,000
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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Lion Consulting |
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Adjusted |
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June 30, 2019 |
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Debit Balances |
Credit Balances |
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Cash |
92,000 |
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450,000 |
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Merchandise Inventory |
370,000 |
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Estimated Returns Inventory |
5,000 |
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Office Supplies |
10,000 |
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Prepaid Insurance |
12,000 |
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Office Equipment |
220,000 |
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58,000 |
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Store Equipment |
650,000 |
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Accumulated Depreciation - Store Equip. |
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87,500 |
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Accounts Payable |
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38,500 |
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Customer Refunds Payable |
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10,000 |
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Salaries Payable |
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4,000 |
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Note Payable (final payment due 2029)* |
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*140,000 |
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M.T. Lion, Capital |
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431,000 |
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M.T. Lion, Drawing |
300,000 |
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Sales |
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8,925,000 |
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Cost of Merchandise Sold |
5,620,000 |
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Sales Salary Expense |
850,000 |
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Advertising Expense |
420,000 |
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Depreciation Expense--Store Equipment |
33,000 |
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Miscellaneous Selling Expense |
18,000 |
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Office Salaries Expense |
540,000 |
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Rent Expense |
48,000 |
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Insurance Expense |
24,000 |
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Depreciation Expense--Office Equipment |
10,000 |
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Office Supplies Expense |
4,000 |
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Miscellaneous Administrative Expense |
6,000 |
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Interest Expense |
12,000 |
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Totals |
9,694,000 |
9,694,000 |
*Note: The current portion of the note payable is $7,000.
Use the Adjusted Trial Balance for Lion Consulting. On the Income Statement, what would the Net Income (or Net Loss) be for Lion Consulting?
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