On October 1, 2019, Santana Rey launched a computer services company, Business Solutions, that is organized as a corporation and provides consulting services, computer system installations, and custom program development. Oct. 1 S. Rey invested $49,000 cash, a $21,000 computer system, and $11,000 of office equipment in the company in exchange for common stock. 3 The company purchased $1,450 of computer supplies on credit from Harris Office Products. 6 The company billed Easy Leasing $5,200 for services performed in installing a new web server. 8 The company paid $1,450 cash for the computer supplies purchased from Harris Office Products on October 3. 10 The company hired Lyn Addie as a part-time assistant for $145 per day, as needed. 12 The company billed Easy Leasing another $1,700 for services performed. 15 The company received $5,200 cash from Easy Leasing as partial payment toward its account. 17 The company paid $705 cash to repair computer equipment damaged when moving it. 20 The company paid $1,668 cash for advertisements published in the local newspaper. 22 The company received $1,700 cash from Easy Leasing toward its account. 28 The company billed IFM Company $5,278 for services performed. 31 The company paid $1,015 cash for Lyn Addie's wages for seven days of work this month. 31 The company paid $3,000 cash in dividends to the owner (sole shareholder). Required: Enter the amount of each transaction on individual items of the accounting equation. Show new balances after each transaction. (Ent decreases to account balances with a minus sign. Enter as per the transaction order provided in the question data.)
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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