Prepare the following: Balance Sheet and Closing Entries
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.
Prepare the following:
Balance Sheet and Closing Entries
![CHART OF ACCOUNTS
ASSETS
LIABILITIES
Current Assets
300 Accounts Payable
100 Cash
302 Unearned Income
101 Accounts Receivable
102 Supplies
103 Prepaid Rent
OWNER'S EQUITY
400 Clean, Capital
401 Clean, Drawing
Non-current Assets
200 Property, Plant and Equipment
INCOME
201 Furniture and Fixtures
500 Service Revenue
202 Land
203 Building
EXPENSES
600 Utilities Expense
601 Salaries and Wages](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F579c043b-c022-4a68-9d84-aaf29089108f%2Fa3a8ec38-0e6d-48e3-ac41-4b517d40c9b0%2F5kyzz6q_processed.png&w=3840&q=75)
![Date
Transactions
2022
March
1
The owner, Mrs. Clean,
invested the following:
building
cash
1,150,000
120,000
Purchased washing machines
and laundry equipment on
account
2
160,000
Received cash as an advance
payment for laundry services
40,500
4.
Received cash from customers
215,200
Rendered partial service for the
advance payment received
25,400
6.
Paid salaries and wages
18,000
7
Paid PLDT, Meralco and
Prime Water
12,500
Withdrew cash for personal use
12,800
Purchased store cabinets
44,000
Rendered the remaining balance
for the advance payment
10
received
11
Billed customers for services
rendered
112,000
12
Paid advance rent for the
commercial stall
20,000
3.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F579c043b-c022-4a68-9d84-aaf29089108f%2Fa3a8ec38-0e6d-48e3-ac41-4b517d40c9b0%2Ft2xby3j_processed.png&w=3840&q=75)
![](/static/compass_v2/shared-icons/check-mark.png)
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)