Presented below are the transactions of Muriel's Fresh Wash Laundry Services for the month of October 2015. Journalize the transactions, prepare the T-accounts, prepare the chart of accounts and the unadjusted trial balance. 2015 October October 1 Muriel borrowed P420, 000 cash from her father and invested it in the business. 2 Borrowed P150, 000 from Mr. McKenzie and signed a promissory note. 5 Bought P2, 200 laundry supplies on credit form Uni-Mart. 6 Laundry services rendered to clients for cash, P9, 000. 9 Laundry services rendered to Ms. Gisel on account, P4, 000. 11 Paid Uni-Mart for the laundry supplies 14 Paid Mr. McKenzie P150, 000 for the loan 18 Paid the electric bill to Meralco, P3, 200 19 Paid the telephone bill for the month, P980 October October October October October October October October 20 Collected account from Ms. Gisel 22 Withdrew P25, 000 for personal use 30 Paid store assistant's salary. P6, 000 October October
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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