Requirements: • Posting • Trial Balance • Worksheet
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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3. Posting
4. Trial Balance
5. Wo
Date
Account / Remarks
Dr.
Cr.
6/2/19 Cash
20,000
Sales
20,000
# to record cash sales
2
6/3/19 Accounts Receivable
15,000
| Sales
15,000
# to recore sales on account
Cost of Sales
12,000
Merchandise Inventory
12,000
# To record COS (under perpetual inventory system)
3
6/5/19 Çash
15,000
Accounts Receivable
15,000
|# to record collection of credit sales last June 3
4
6/7/19 Computer Equipment
25,000
25,000
Accounts Payable
# to record purchase of Comp Equipment on account
5
6/9/19 Purchases
35,000
Cash
35,000
# to record purchase of inventory via cash
6
6/15/19 Cash
4,500
Loss on sale of Computer Table
Computer table
# to record sale of computer table
500
5,000
6/17/19 Owner's Drawing
5,000
Cash
5,000
# to record cash withrawal from owner
6/20/19 Salaries Expense
3,000
Cash
3,000
# to record Salaries paid
9
6/22/19 Purchases
50,000
Accounts Payable
50,000
# to record purchases on account
10
6/30/19 Bad Debt Expense
2,000
Allowance for doubtful accounts
2,000
# to record estimated uncollectible receivable
AJE
Depreciation Expense
Accumulate Depreciation - OE
# to record depreciation of Office Equipment
500
500
Supplies Expense
| Office Supplies
# to record supplies used
750
750
Amortization Expense
450
Accumulated Amortization - CS
450
# to record amortization of computer software
Furnitures
5,000
Owner's Drawings
5,000
# to correct entry last Jun 17"
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