Required information [The following information applies to the questions displayed below.] The December 31, 2021, unadjusted trial balance for Demon Deacons Corporation is presented below. Debit $10,000 Credit Accounts Cash Accounts Receivable Prepaid Rent Supplies 15,000 7,200 4,000 $ 3,000 11,000 6,000 51,200 Deferred Revenue Common Stock Retained Earnings Service Revenue Salaries Expense 35,000 $71,200 $71,200 At year-end, the following additional information is available: 1. The balance of Prepaid Rent, $7,200, represents payment on October 31, 2021, for rent from November 1, 2021, to April 30, 2022. 2. The balance of Deferred Revenue, $3,000, represents payment in advance from a customer. By the end of the year, of the services have been provided. 3. An additional $700 in salaries is owed to employees at the end of the year but will not be paid until January 4, 2022. 4. The balance of Supplies, $4,000, represents the amount of office supplies on hand at the beginning of the year of $1,700 plus an additional $2,300 purchased throughout 2021. By the end of 2021, only $800 of supplies remains.
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.]
The December 31, 2021, unadjusted trial balance for Demon Deacons Corporation is presented below.
Debit
$10,000
Credit
Accounts
Cash
Accounts Receivable
Prepaid Rent
Supplies
15,000
7,200
4,000
$ 3,000
11,000
6,000
51,200
Deferred Revenue
Common Stock
Retained Earnings
Service Revenue
Salaries Expense
35,000
$71,200
$71,200
At year-end, the following additional information is available:
1. The balance of Prepaid Rent, $7,200, represents payment on October 31, 2021, for rent from November 1, 2021, to April
30, 2022.
2. The balance of Deferred Revenue, $3,000, represents payment in advance from a customer. By the end of the year,
of the services have been provided.
3. An additional $700 in salaries is owed to employees at the end of the year but will not be paid until January 4, 2022.
4. The balance of Supplies, $4,000, represents the amount of office supplies on hand at the beginning of the year of
$1,700 plus an additional $2,300 purchased throughout 2021. By the end of 2021, only $800 of supplies remains.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1a1a9163-e6b6-4851-a874-678aa030b63a%2F42da4906-d79d-4a49-b476-fbfc7f748549%2F7v3c862.png&w=3840&q=75)
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