Post the journal to a ledger of four-column accounts, see the Excel tab labeled
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.
|
Date |
Transaction |
|
June 1 |
The following assets were received from Dustin Larkin:
Cash, $10,000; |
|
June 1 |
Paid three months' rent on a lease rental contract, $4,500. |
|
June 2 |
Paid the premiums on property and casualty insurance policies, $1,800. |
|
June 4 |
Received cash from clients as an advance payment for services to be provided (Record it as unearned fees), $3,000. |
|
June 5 |
Purchased additional office equipment on account from Crawford Company, $1,800. June 6. |
|
June 6 |
Received cash from clients on account, $800. |
|
June 10 |
Paid cash for a newspaper advertisement to run during June, $120. |
|
June 12. |
Paid Crawford Company for part of the debt incurred on June 5, $800. |
|
June 12. |
Recorded services provided on account for the period June 1 to June 12, $2,250. |
|
June 14 |
Paid part-time receptionist for 2 weeks' salary, $400. (Note: Ignore any payroll tax or withholdings). |
|
June 17 |
Recorded cash from cash clients for fees earned during the period June 1-16, $3,175. |
|
June 18 |
Paid cash for supplies, $750. |
|
June 20 |
Recorded services provided on account for the period June 13-20, $1,100. |
|
June 24 |
Recorded cash from cash clients for fees earned for the period June 17-24, $1,850. |
|
June 26 |
Received cash from clients on account, $1,600. |
|
June 27 |
Paid part-time receptionist for two weeks' salary, $400. (Note: Ignore any payroll tax or withholdings). |
|
June 29 |
Paid telephone bill for June, $130. |
|
June 30 |
Paid electricity bill for June, $200. |
|
June 30 |
Recorded cash from cash clients for fees earned for the period June 25-30, $2,050 |
|
June 30 |
Recorded services provided on account for the remainder of June, $1,000. |
|
June 30 |
Dustin withdrew $4,500 for personal use. |
Instructions-Use the Excel template provided in the class titled “Unit 2 and 3 Management Tools Assignment” to complete the following 3 requirements for Unit 2:
- Journalize each transaction in the two-column journal tab, referring to the following chart of accounts in selecting the accounts to be debited and
|
11-Cash |
31-Dustin Larkin, Capital |
|
12-Accounts Receivable |
32-Dustin Larkin, Drawing |
|
14-Supplies |
41-Fees Earned |
|
15-Prepaid Rent |
51-Salary Expense |
|
16-Prepaid Insurance |
52-Rent Expense |
|
18-Office Equipment |
53-Supplies Expense |
|
19- |
54-Depreciation Expense |
|
21-Accounts Payable |
55-Insurance Expense |
|
22-Salaries Payable |
59-Miscellaneous Expense |
|
23-Unearned Fees |
|
- Post the journal to a ledger of four-column accounts, see the Excel tab labeled
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