Problem 3-8B Complete the full accounting cycle (LO3-3, 3-4, 3-5, 3-6, 3-7) [The following information applies to the questions displayed below.] The general ledger of Pipers Plumbing at January 1, 2021, includes the following account balances: Credits Accounts Cash Accounts Receivable Supplies Equipment Accumulated Depreciation Accounts Payable Utilities Payable Deferred Revenue Common Stock Retained Earnings Totals Debits $ 3,850 8,850 2,850 23,000 $5,400 3,400 4,400 0 16,500 8,850 $38,550 $38,550 The following is a summary of the transactions for the year: 1. January 24 Provide plumbing services for cash, $13,500, and on account, $58,500. 2. March 13 Collect on accounts receivable, $46,500. 6 Issue shares of common stock in exchange for $11,000 cash. 3. May 4. June 30 Pay salaries for the current year, $31,700. 5. September 15 Pay utilities of $4,400 from 2020 (prior year). 6. November 24 Receive cash in advance from customers, $7,400. 7. December 30 Pay $1,700 cash dividends to stockholders. The following information is available for the adjusting entries. Depreciation for the year on the machinery is $5,400. Plumbing supplies remaining on hand at the end of the year equal $1,100. Of the $7,400 paid in advance by customers, $5,700 of the work has been completed by the end of the year. Accrued utilities at year-end amounted to $7,300.
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.
![Problem 3-8B Complete the full accounting cycle (LO3-3, 3-4, 3-5, 3-6, 3-7)
[The following information applies to the questions displayed below.]
The general ledger of Pipers Plumbing at January 1, 2021, includes the following account balances:
Accounts
Cash
Accounts Receivable
Supplies
Equipment
Accumulated Depreciation
Accounts Payable
Utilities Payable
Deferred Revenue
Common Stock
Retained Earnings
Totals
Debits Credits
$ 3,850
8,850
2,850
23,000
$ 5,400
3,400
4,400
0
16,500
8,850
$38,550 $38,550
The following is a summary of the transactions for the year:
1. January
2. March
24 Provide plumbing services for cash, $13,500, and on account, $58,500.
13 Collect on accounts receivable, $46,500.
6 Issue shares of common stock in exchange for $11,000 cash.
30 Pay salaries for the current year, $31,700.
3. May
4. June
5. September 15 Pay utilities of $4,400 from 2020 (prior year).
6. November 24 Receive cash in advance from customers, $7,400.
7. December 30 Pay $1,700 cash dividends to stockholders.
The following information is available for the adjusting entries.
Depreciation for the year on the machinery is $5,400. Plumbing supplies remaining on hand at the end of the year equal
$1,100. Of the $7,400 paid in advance by customers, $5,700 of the work has been completed by the end of the year.
Accrued utilities at year-end amounted to $7,300.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2ee27961-2d98-4069-bd8e-4c3d99346202%2F904409ef-3c55-45d4-9e24-21de6d831cc6%2Ffaywxgk_processed.jpeg&w=3840&q=75)
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