Required information [The following information applies to the questions displayed below.] Psymon Company, Incorporated, sells construction equipment. The annual fiscal period ends on December 31. The following adjusted trial balance was created from the general ledger accounts on December 31: Account Titles Cash Accounts Receivable Inventory Property and Equipment Accumulated Depreciation Accounts Payable Common Stock Retained Earnings, January 1 Sales Revenue Cost of Goods Sold Salaries and Wages Expense Office Expense Interest Expense Income Tax Expense Totals Debits $ 56,720 23,600 86,000 64,000 131,600 22,600 23,600 3,400 13,380 $ 424,900 Credits $ 26,900 39,800 118,000 14,400 225,800 $ 424,900 Required: 1. Prepare a multistep income statement that would be used for external reporting purposes. TIP: Some of the accounts listed will appear on the balance sheet rather than the income statement.
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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Required information
[The following information applies to the questions displayed below.]
Psymon Company, Incorporated, sells construction equipment. The annual fiscal period ends on December 31. The
following adjusted trial balance was created from the general ledger accounts on December 31:
Account Titles
Cash
Accounts Receivable
Inventory
Property and Equipment
Accumulated Depreciation
Accounts Payable
Common Stock
Retained Earnings, January 1
Sales Revenue
Cost of Goods Sold
Salaries and Wages Expense
Office Expense
Interest Expense
Income Tax Expense
Totals
Debits
$ 56,720
23,600
86,000
64,000
131,600
22,600
23,600
3,400
13,380
$ 424,900
Credits
$ 26,900
39,800
118,000
14,400
225,800
$ 424,900
Require
1. Prepare a multistep income statement that would be used for external reporting purposes. TIP: Some of the accounts listed will
appear on the balance sheet rather than the income statement.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa8b33c5c-89d8-4547-8d85-1b99c47e1f06%2Fee5245e6-613d-40b1-90e4-807c8a8d36b2%2Fd5ylm4a_processed.png&w=3840&q=75)
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