Maury Wills started an environmental consulting business & during the first month of operations (June 2008) completed the following transactions: Wills began the business with an investment of $25,000 cash and a building valued at $30,000. The business gave Wills the owner’s equity in the firm. Purchased office supplies on account, $2,100 Paid $18,000 for office furniture Pail employee’s salary, $2,200 Performed consulting service on account, $5,100 Paid $800 on the account payable created in transaction (b) Received a $600 bill for advertising expense that will be paid in the near future Performed consulting service for customers and received cash, $1,6000 Received cash on account, $1,200 Pain the following cash expenses and made a single compound entry: Rent on equipment, $700 Utilities, $400 Withdrew $3000 for personal use Required: Record each transaction in the journal. Use the letters to identify the transactions. Post the entries to the ledger accounts Prepare the trial balance on Wills Environmental Consulting at June 30, 2008
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.
- Maury Wills started an environmental consulting business & during the first month of operations (June 2008) completed the following transactions:
- Wills began the business with an investment of $25,000 cash and a building valued at $30,000. The business gave Wills the owner’s equity in the firm.
- Purchased office supplies on account, $2,100
- Paid $18,000 for office furniture
- Pail employee’s salary, $2,200
- Performed consulting service on account, $5,100
- Paid $800 on the account payable created in transaction (b)
- Received a $600 bill for advertising expense that will be paid in the near future
- Performed consulting service for customers and received cash, $1,6000
- Received cash on account, $1,200
- Pain the following cash expenses and made a single compound entry:
- Rent on equipment, $700
- Utilities, $400
- Withdrew $3000 for personal use
Required:
- Record each transaction in the journal. Use the letters to identify the transactions.
-
Post the entries to the ledger accounts - Prepare the
trial balance on Wills Environmental Consulting at June 30, 2008
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