On Jul1 1, 2016, Mr. Jan Jacob C. Solon opened the Hubbies Hair and Beauty Salon. The following transactions took place during the first month of operation: July 1 - Php 200,000.00 was invested by the owner. - Paid installation of utilities, Php 7,200.00 2 - Paid business permits and licenses to the government, Php 3,500.00 Paid advance rent for the salon space, Php 10,000.00 3 - Purchased equipment on account amounting to Php 85,000.00 - Purchases salon supplies in cash, Php 25,000.00 5 - Served various customers and received cash, Php 9,600.00 7 - Rendered services, Php 12,000.00 and only 9,000 cash was received. The rest was on account. 10 - Received cash, Php 8,200.00 from various customers. 13 - Received Php 23,500.00 cash from various customers while Php 2,400.00 worth of services were still receivables. 15 - Paid salaries of salon assistants, Php 7,600.00 18 - Received cash for services rendered, Php 14,100.00 21 - Received and paid bill on utilities, Php 2,200.00 23 - Received cash of Php 7,500.00 from various customers. 28 - Collected 50% of the account on July 7, 2016. 29 - Received cash for services rendered, Php 10,200.00 30 - Collected the account on July 13. 31 - Withdrew Php 10,000.00 cash for personal use. - Paid salaries of assistants, Php 7,600.00 Instructions: 1. Plot the transactions in the t-accounts using the following account titles: a. Cash on Hand b. Accounts Receivable c. Salon Supplies d. Prepaid Rent e. Salon Equipment f. Accounts Payable g. Solon, Capital h. Solon, Withdrawal i. Salon Services Revenue j. Permits and Licenses k. Utilities Expense l. Salaries Expense
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.
Lesson 6
Posting the
Learning Outcomes:
Students are expected to:
1.
2. Determine the exact amount of the account
On Jul1 1, 2016, Mr. Jan Jacob C. Solon opened the Hubbies Hair and Beauty Salon. The
following transactions took place during the first month of operation:
July 1 - Php 200,000.00 was invested by the owner.
- Paid installation of utilities, Php 7,200.00
2 - Paid business permits and licenses to the government, Php 3,500.00
Paid advance rent for the salon space, Php 10,000.00
3 - Purchased equipment on account amounting to Php 85,000.00
- Purchases salon supplies in cash, Php 25,000.00
5 - Served various customers and received cash, Php 9,600.00
7 - Rendered services, Php 12,000.00 and only 9,000 cash was received.
The rest was on account.
10 - Received cash, Php 8,200.00 from various customers.
13 - Received Php 23,500.00 cash from various customers while Php
2,400.00 worth of services were still receivables.
15 - Paid salaries of salon assistants, Php 7,600.00
18 - Received cash for services rendered, Php 14,100.00
21 - Received and paid bill on utilities, Php 2,200.00
23 - Received cash of Php 7,500.00 from various customers.
28 - Collected 50% of the account on July 7, 2016.
29 - Received cash for services rendered, Php 10,200.00
30 - Collected the account on July 13.
31 - Withdrew Php 10,000.00 cash for personal use.
- Paid salaries of assistants, Php 7,600.00
Instructions:
1. Plot the transactions in the t-accounts using the following account titles:
a. Cash on Hand
b. Accounts Receivable
c. Salon Supplies
d. Prepaid Rent
e. Salon Equipment
f. Accounts Payable
g. Solon, Capital
h. Solon, Withdrawal
i. Salon Services Revenue
j. Permits and Licenses
k. Utilities Expense
l. Salaries Expense
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