On February 1, 20A4, Mira Delamar opened a store that sells school supplies. Mira wanted to know the results of opening the store. Mira knew you were studying accounting so she asked for your help. The following were taken from the accounting records of Mira’s Store. Balance Debit Credit Sales ₱114,567 Sales return 1,544 Sales discount 1,675 Purchases 61,558 Purchase return 504 Purchase discount 1,076 Freight-in 765 Utilities expense 4,000 Salaries Expense 14,000 Rent expense 10,000 Depreciation 500 Additional Information: a. Physical inventory conducted at the end of the year revealed an ending inventory of ₱15,345. b. Depreciation is for shelves and cabinets used as displays racks and storage in the store. c. Mira has a small office inside the store. Allocate 15% of rent and utilities to general administrative expense. d. 25% of Emily’s Salaries are allocated to General and Administrative Expense. Aside from tending the store, she was also tasked to file receipts and maintain some records. Requirements: 1. All accounts above have normal balances. Indicate whether the above accounts have debit or credit balances. 2. Prepare the year ended SCI using the single-step approach. 3. Prepare the year ended SCI using the multi-step approach.
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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