Strand Corp had the following: Unadjusted Trial Bal. Adjustments Adjusted Trial Balance --adjusting entries--- debit credit debit credit debit credit debit credit Cash $50,000 Common Stock $30,000 APIC-Common Stk $20,000 Revenues $250,000 Equipment $125,000 Accum Deprec $40,000 Wage exp $75,000 Utilities exp $15,000 Unearned revenues $15,000 Deprec. Exp $30,000 Accounts payable $7,000 Supplies $36,000 Accounts receivable $100,000 Wages payable $13,000 Retained earnings $50,000 Supplies exp $10,000 Note payable $40,000 Prepaid insurance $24,000 Total $465,000 $465,000 REQUIRED: Based on the following info, make the necessary adjustments to the Worksheet and prepare an Adjusted Trial Balance, with final totals 1. 3% of the accounts receivable are deemed uncollectable 2. Addt'l Depreciation was calculated to be $10,000 3. Prepaid insurance represents 12 month, 4 months have expired 4. The supplies actual balance should be $16,000 5. The note carries an interest of 6% and 3 months should be accrued 6. 50% of the uneraned revenue has been earned
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.
| Strand Corp had the following: | |||||||||||||
| Unadjusted Trial Bal. | Adjustments | Adjusted |
-- |
||||||||||
| debit | credit | debit | credit | debit | credit | debit | credit | ||||||
| Cash | $50,000 | ||||||||||||
| Common Stock | $30,000 | ||||||||||||
| APIC-Common Stk | $20,000 | ||||||||||||
| Revenues | $250,000 | ||||||||||||
| Equipment | $125,000 | ||||||||||||
| Accum Deprec | $40,000 | ||||||||||||
| Wage exp | $75,000 | ||||||||||||
| Utilities exp | $15,000 | ||||||||||||
| Unearned revenues | $15,000 | ||||||||||||
| Deprec. Exp | $30,000 | ||||||||||||
| Accounts payable | $7,000 | ||||||||||||
| Supplies | $36,000 | ||||||||||||
| $100,000 | |||||||||||||
| Wages payable | $13,000 | ||||||||||||
| $50,000 | |||||||||||||
| Supplies exp | $10,000 | ||||||||||||
| Note payable | $40,000 | ||||||||||||
| Prepaid insurance | $24,000 | ||||||||||||
| Total | $465,000 | $465,000 | |||||||||||
| REQUIRED: | |||||||||||||
| Based on the following info, make the necessary adjustments to the Worksheet and | |||||||||||||
| prepare an Adjusted Trial Balance, with final totals | |||||||||||||
| 1. 3% of the accounts receivable are deemed uncollectable | |||||||||||||
| 2. Addt'l |
|||||||||||||
| 3. Prepaid insurance represents 12 month, 4 months have expired | |||||||||||||
| 4. The supplies actual balance should be $16,000 | |||||||||||||
| 5. The note carries an interest of 6% and 3 months should be accrued | |||||||||||||
| 6. 50% of the uneraned revenue has been earned | |||||||||||||
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