Starbooks Corporation provides an online bookstore for electronic books. The following is a simplified list of accounts and amounts reported in its accounting records. The accounts have normal debit or credit balances. Assume the year ended on September 30, 2021. Accounts Payable Accounts Receivable Accumulated Depreciation Cash Common Stock Deferred Revenue Depreciation Expense Equipment Income Tax Expense Interest Revenue Notes Payable (long-term) Notes Payable (short-term) Prepaid Rent Rent Expense Retained Earnings salaries and wages Expense Service Revenue Supplies Supplies Expense Travel Expense $ 604 384 904 304 284 284 384 3,284 304 104 204 584 104 404 1,504 2,204 6,212 584 204 2,604 2. Prepare the closing entry required at September 30, 2021. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
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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Starbooks Corporation provides an online bookstore for electronic books. The following is a simplified list of accounts and
amounts reported in its accounting records. The accounts have normal debit or credit balances. Assume the year ended
on September 30, 2021.
Accounts Payable
Accounts Receivable
Accumulated Depreciation
Cash
Common Stock
Deferred Revenue
Depreciation Expense
Equipment
Income Tax Expense
Interest Revenue
Notes Payable (long-term)
Notes Payable (short-term)
Prepaid Rent
Rent Expense
Retained Earnings
Salaries and Wages Expense
Service Revenue
Supplies
Supplies Expense
Travel Expense
View transaction liet
Journal entry worksheet
Note: Enter debits before credits.
Date
September 30, 2021
$ 604
384
2. Prepare the closing entry required at September 30, 2021. (If no entry is required for a transaction/event, select "No Journal Entry
Required" in the first account field.)
Record entry
984
384
284
Clear entry
284
384
3,204
384
184
284
584
184
484
Record the closing entry required at September 30, 2021.
1,584
2,204
6,212
584
284
2,604
General Journal
Debit
Credit
View general Journal
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