Scenarios: Service Revenue at 1/2/2014 Interest Revenue on Carrying Income Value at Statement 12/31/201 ending 12/31/2015 5 $ Blank 1 $ Blank 2 $ Blank 3 (1) Sparky will require Wildcat to make an initial cash down payment of $30,000 on Jan. 2, 2014 (this is NOT a PVAD...simply a cash down payment so that Wildcat will not finance 100% of the services.) The remainder will be financed in the form of a $250,000, 5% note due December 31, 2017. Interest will be remitted each June 30 & Dec. 31, with principal due at maturity. (2) Sparky will provide the service in exchange for a non-interest-bearing note with a face value of $285,000. Terms of the note require Principal & Interest (P&I) payments be made each June 30 & $ Blank 4 Dec 31 for the next 4 years. (3) Sparky will provide the service in exchange for a four-year, $252,140, 8% note with P&I payments made each Jun 30 & Dec 31. The first payment will be received on Jun 30th. $Blank 5 $ Blank 6 $Blank 7 $ Blank 8 Blank 9
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.
On January 2, 2014, Sparky Company performed consultation services for Wildcat Corporation and agreed to allow Wildcat to pay over time. Sparky is considering several different note options below. Wildcat's normal borrowing rate is 8%. For each option listed below, determine Service Revenue Sparky can record at Jan. 2, 2014, Interest Revenue to be recorded at December 31, 2015, and the Carrying Value of the Note Receivable on their
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