Office supplies 6,200 Salaries expense 32,000 Office equipment 58,300 1,290 Miscellaneous expenses Land 24,300 140,000 Retained earnings, July 1 Sales 152,250 160,000 Common stock Cash dividends 5,300 Accounts payable 2,000 4. The following are selected transactions of Drcman, Inc.: May 10 16 Sold and shipped on account to Linley, Inc. merchandise for $2,300, terms 2/10, n/30. Linley, Inc. returned merchandise billed at $600 on May 10. Received a check from Linley, Inc. for full settlement of the May 10 transaction. 19 Record the above transactions in general journal form as they would appear on the books of (a) Drcman, Inc. and (b) Linley, Inc. Linley, Inc. records purchases at invoice price. Both companies use the periodic inventory system. Omit explanations for the journal entries. The following are selected transactions of Midnight, Inc.: Sold and shipped on account to Sirius, Inc. merchandise for $3,000 ($1,800 cost), terms 2/10, n/30. May 10
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.
Please help with practice problem #4 for a and b.
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