QUESTION 1 Match the statements below with the appropriate terms by entering the appropriate letter code in the spaces provided. TERMS: A. Prepaid Expenses Paid in cash b4 st use/consume. B. Unearned Revenues Cash receive before performe C. Accrued Revenues Service perform, cash later. D. Accrued Expenses Expence perform each later. STATEMENTS: I. A revenue not yet earned; collected in advance. A 2. Office supplies on hand that will be used in the next period. 3. Interest revenue collected, not yet earned. 4. Rent not yet collected; already earned. 5. An expense incurred, not yet paid or recorded. 6. A revenue camed; not yet collected or recorded. 7. An expense not yet incurred, paid in advance. D Interest expense incurred, not yet paid. QUESTION 2 Silas Company prepares accounts for accounting year end December 31. Prepare the appropriate adjusting entries for the year ended December 31, 2018 for the following items. a. Interest of $500 is accrued on a note receivable at December 31, 2018. b. Silas has three employees who each earn $160 per day. At December 31, four days' salaries have been earned but not paid. BALA B D A c. A customer paid Silas $16,000 on December 1 2008 for services to be rendered from December 1 through January 31, 2019. d. Silas purchased equipment costing $48,000 on January 1, 2017. Annual depreciation is $6000, e. Silas provided services to a customer in 2018 at a fee of $500. This fee has not yet been received or billed f. Silas started the year with no supplies on hand. They purchased $6,000 in supplies during the year and have $2,000 on hand at December 31. g. Silas paid $12,000 for a three-year insurance policy on July 1, 2018, debiting an asset account at that time. h. Silas borrowed $20,000 by signing a 9% interest, note payable on November 1, 2018. i Silas purchased short-term investments on November 1, 2018. Interest of $300 per month has been earned but not received prior to December 31. QUESTION 3 Johan Graphic Enterprise was established by Mr. Johan on 1 January 2021. At the end of the sixth month of its operation, the trial balance containing the relevant account balances is shown as follows Johan Graphic Enterprise Trial Balance as at 30 June 2021 Credit (RM) Cash Fumiture and equipment Vehicle Supplies Prepaid Insurance Note Payable 20,000 Uneared service revenue 15,000 Capital 100,000 Drawings Debit (RM) 35,000 40,000 220,000 3,500 17,500 15,000
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.
Silas Company accounts for accounting year end December 31. Prepare the appropriate
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