Lloyd’s Auto Specialist Ltd. journal entry for August 2021 Date Details DR CR 1-Aug Cash 150,000 Capital 150,000 4-Aug Supplies 81,360 Right Way Manufacturers 81,360 5-Aug Cash 14,670 Service Revenue 14,670 7-Aug Rent Expense 5,000 Bank 5,000 10-Aug Wages Expenses 8,000 Bank 8,000 10-Aug Cash 3,500 CT Limited 3,500 11-Aug Auto Care 20,200 Service Revenue 20,200 12-Aug Fixtures 8,000 CT Ltd 8,000 13-Aug Cash 25,000 Loan NBC 25,000 14-Aug P&S Auto 45,100 Service Revenue 45,100 21-Aug CT Ltd 8,000 Bank 8,000 22-Aug Wage Expenses 8,000 Cash 8,000 23-Aug Right Way Manufacturer 69,156 Discount Allowed 69,156 27-Aug Discount Allowed 40,590 P&S Auto 40,590 27-Aug Electricity Expense 1,500 Cash 15,000 28-Aug Drawings 5,000 Bank 5,000 28-Aug Cash 9,680 Service Revenue 9,680 30-Aug Cash 13,850 Serivice Revenue 13,850 31-Aug Supplies 19,540 Supplies Expense 19,540 Post the transactions to the general ledger and balance off each account Extract a trial balance on August 31st. Prepare an Income Statement for the month ended August 31st, the owner’s equity statement and a Balance Sheet as at that date
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.
Lloyd’s Auto Specialist Ltd.
| Date | Details | DR | CR |
| 1-Aug | Cash | 150,000 | |
| Capital | 150,000 | ||
| 4-Aug | Supplies | 81,360 | |
| Right Way Manufacturers | 81,360 | ||
| 5-Aug | Cash | 14,670 | |
| Service Revenue | 14,670 | ||
| 7-Aug | Rent Expense | 5,000 | |
| Bank | 5,000 | ||
| 10-Aug | Wages Expenses | 8,000 | |
| Bank | 8,000 | ||
| 10-Aug | Cash | 3,500 | |
| CT Limited | 3,500 | ||
| 11-Aug | Auto Care | 20,200 | |
| Service Revenue | 20,200 | ||
| 12-Aug | Fixtures | 8,000 | |
| CT Ltd | 8,000 | ||
| 13-Aug | Cash | 25,000 | |
| Loan NBC | 25,000 | ||
| 14-Aug | P&S Auto | 45,100 | |
| Service Revenue | 45,100 | ||
| 21-Aug | CT Ltd | 8,000 | |
| Bank | 8,000 | ||
| 22-Aug | Wage Expenses | 8,000 | |
| Cash | 8,000 | ||
| 23-Aug | Right Way Manufacturer | 69,156 | |
| Discount Allowed | 69,156 | ||
| 27-Aug | Discount Allowed | 40,590 | |
| P&S Auto | 40,590 | ||
| 27-Aug | Electricity Expense | 1,500 | |
| Cash | 15,000 | ||
| 28-Aug | Drawings | 5,000 | |
| Bank | 5,000 | ||
| 28-Aug | Cash | 9,680 | |
| Service Revenue | 9,680 | ||
| 30-Aug | Cash | 13,850 | |
| Serivice Revenue | 13,850 | ||
| 31-Aug | Supplies | 19,540 | |
| Supplies Expense | 19,540 |
Post the transactions to the general ledger and balance off each account- Extract a
trial balance on August 31st. - Prepare an Income Statement for the month ended August 31st, the owner’s equity statement and a Balance Sheet as at that date
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 7 images
