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: AccountsDebits Credits Cash$3,950 Accounts Receivable 8,950 Supplies 2,950 Equipment 25,000 Accumulated Depreciation $5,800 Accounts Payable 3,800 Utilities Payable 4,800 Deferred Revenue 0 Common Stock 17,500 Retained Earnings 8,950 Totals$40,850 $40,850 The following is a summary of the transactions for the year: 1. January 24 Provide plumbing services for cash, $14,500, and on account, $59,500. 2. March 13 Collect on accounts receivable, $47,500. 3. May 6 Issue shares of common stock in exchange for $12,000 cash. 4. June 30 Pay salaries for the current year, $31,900. 5. September 15 Pay utilities of $4,800 from 2020 (prior year). 6. November 24 Receive cash in advance from customers, $7,800. 7. December 30 Pay $1,900 cash dividends to stockholders. The following information is available for the adjusting entries. Depreciation for the year on the machinery is $5,800. Plumbing supplies remaining on hand at the end of the year equal $1,200. Of the $7,800 paid in advance by customers, $5,900 of the work has been completed by the end of the year. Accrued utilities at year-end amounted to $7,100 Problem 3-8B Part 9 9. Record closing entries. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)
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:
AccountsDebits Credits
Cash$3,950
Supplies 2,950
Equipment 25,000
Accounts Payable 3,800
Utilities Payable 4,800
Deferred Revenue 0
Common Stock 17,500
Totals$40,850 $40,850
The following is a summary of the transactions for the year:
1. January 24 Provide plumbing services for cash, $14,500, and on account, $59,500.
2. March 13 Collect on accounts receivable, $47,500.
3. May 6 Issue shares of common stock in exchange for $12,000 cash.
4. June 30 Pay salaries for the current year, $31,900.
5. September 15 Pay utilities of $4,800 from 2020 (prior year).
6. November 24 Receive cash in advance from customers, $7,800.
7. December 30 Pay $1,900 cash dividends to stockholders.
The following information is available for the
Depreciation for the year on the machinery is $5,800. Plumbing supplies remaining on hand at the end of the year equal $1,200. Of the $7,800 paid in advance by customers, $5,900 of the work has been completed by the end of the year. Accrued utilities at year-end amounted to $7,100
Problem 3-8B Part 9
9. Record closing entries. (If no entry is required for a particular transaction/event, select "No
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