No. Account Title Debit Credit $ 38,264 12,618 2,545 2,220 3,300 101 Cash Accounts receivable 106 126 128 Computer supplies Prepaid insurance Prepaid rent Office equipment 131 163 8.000
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.
a.Prepare Journal
b.Prepare adjuted
c.prepare post closing trial balance
![No.
Account Title
Debit
Credit
101
Cash
$ 38,264
12,618
2,545
2,220
3,300
8,000
106
Accounts receivable
126
Computer supplies
Prepaid insurance
Prepaid rent
Office equipment
Accumulated depreciation-0ffice equipment
Computer equipment
Accumulated depreciation-Computer equipment
Accounts payable
Wages payable
Unearned computer services revenue
Common stock
Retained earnings
Dividends
128
131
163
164
ik
167
20,000
168
nces
201
0.
210
236
307
318
319
73,000
5,600
403
Computer services revenue
Depreciation expense-Office equipment
Depreciation expense-Computer equipment
Wages expense
Insurance expense
Rent expense
Computer supplies expense
Advertising expense
Mileage expense
Miscellaneous expenses
Repairs expense-Computer
25,659
612
613
623
2,625
637
640
652
0.
1,728
655
676
677
684
704
250
805
Totals
$ 98,659
$98, 659
Dec. 2 Paid $1,025 cash to Hillside Mall for Business Solutions' share of mall advertising costs.
3 Paid $500 cash for minor repairs to the company's computer.
4 Received $3,950 cash from Alex's Engineering Co. for the receivable from November.
10 Paid cash to Lyn Addie for six days of work at the rate of $125 per day.
14 Notified by Alex's Engineering Co. that Business Solutions' bid of $7,000 on a proposed project has
been accepted. Alex's paid a $1,500 cash advance to Business Solutions.
15 Purchased $1,100 of computer supplies on credit from Harris Office Products.
16 Sent a reminder to Gomez Co. to pay the fee for services recorded on November 8.
20 Completed a project for Liu Corporation and received $5,625 cash.
22-26 Took the week off for the holidays.
28 Received $3,000 cash from Gomez Co. on its receivable,
29 Reimbursed S. Rey for business automobile mileage (600 miles at $0.32 per mile).
31 The company paid $1,500 cash in dividends.
The following additional facts are collected for use in making adjusting entries prior to preparing financial statements for the
company's first three months:
a. The December 31 inventory count of computer supplies shows $580 still available.
b. Three months have expired since the 12-month insurance premium was paid in advance.
c. As of December 31, Lyn Addie has not been paid for four days of work at $125 per day.
d. The computer system, acquired on October 1, is expected to have a four-year life with no salvage value.
e. The office equipment, acquired on October 1, is expected to have a five-year life with no salvage value.
f. Three of the four months' prepaid rent has expired.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1d39f439-c0df-4260-bff7-863bf3eaa9a0%2F5619ff55-ec75-4d67-a5f5-54e6cb044c7e%2F401tigj_processed.png&w=3840&q=75)
![](/static/compass_v2/shared-icons/check-mark.png)
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 9 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)