Stant Company is a small editorial services company owned and operated by Tracy Stant. On July 31, 2012, the end of the current year, Stant Company’s accounting clerk prepared the unadjusted trial balance: Stant Company Unadjusted Trial Balance July 31, 2020 Cash $7,500 Accounts Receivable 38,400 Prepaid insurance 7,200 Supplies 1,980 Land 112,500 Building 200,250 Accumulated depreciation – Building $137,550 Equipment 135,300 Accumulated depreciation – Equipment 97,950 Accounts payable 12,150 Salaries and wages payable 0 Unearned rent 6,750 Tracy Stant, Capital 221,000 Tracy Stant, Drawing 15,000 Fees earned 324,600 Salaries and wages expense 193,370 Utilities expense 42,375 Insurance expense 0 Supplies expense 0 Depreciation expense 0 Advertising expense 22,800 Repairs expense 17,250 Miscellaneous expense 6,075 $800,000 $800,000 Use this trial balance to journalize the following adjusting entries. Unexpired Insurance at July 31, $3,500. DATE Debit Credit 7/31 QUESTION 3 Supplies used during the period, $800. DATE Debit Credit 7/31 QUESTION 4 Depreciation of equipment, $1,900. DATE Debit Credit 7/31 QUESTION 5 Accrued salaries and wages, $1,700. DATE Debit Credit 7/31 QUESTION 6 Fees earned but unbilled on July 31, $12,740. DATE Debit Credit 7/31
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
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Stant Company is a small editorial services company owned and operated by Tracy Stant. On July 31, 2012, the end of the current year, Stant Company’s accounting clerk prepared the unadjusted
trial balance :Stant Company
Unadjusted Trial Balance
July 31, 2020
Cash
$7,500
Accounts Receivable 38,400
Prepaid insurance
7,200
Supplies
1,980
Land
112,500
Building
200,250
Accumulated depreciation – Building$137,550
Equipment
135,300
Accumulated depreciation – Equipment
97,950
Accounts payable
12,150
Salaries and wages payable
0
Unearned rent
6,750
Tracy Stant, Capital
221,000
Tracy Stant, Drawing
15,000
Fees earned
324,600
Salaries and wages expense
193,370
Utilities expense
42,375
Insurance expense
0
Supplies expense
0
Depreciation expense
0
Advertising expense
22,800
Repairs expense
17,250
Miscellaneous expense
6,075
$800,000
$800,000
Use this trial balance to journalize the following
adjusting entries .Unexpired Insurance at July 31, $3,500.
DATE
Debit
Credit
7/31
QUESTION 3
-
Supplies used during the period, $800.
DATE
Debit
Credit
7/31
QUESTION 4
-
Depreciation of equipment, $1,900.
DATE
Debit
Credit
7/31
QUESTION 5
-
Accrued salaries and wages, $1,700.
DATE
Debit
Credit
7/31
QUESTION 6
-
Fees earned but unbilled on July 31, $12,740.
DATE
Debit
Credit
7/31
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