The ABC Manufacturing Company has the following transactions: 1. The company processed P400,000 raw materials. % of the materials are direct while the remaining is indirect. 2. The factory payroll for the month is as follows: Gross Payroll SSS Payable Utilities Rent Insurance Philhealth Payable Pag-ibig Payable WHT Payable The payroll will be paid next week. 3. Half of the payroll is distributed as direct, the remaining is indirect. 4. Other factory costs were as follows: P300,000 (40,000) (30,000) (20,000) (25.000) P185,000 P45,000 60,000 30,000 All these costs were paid right away. 5. All indirect cost accounts were included in the processing of the products. 6. Out of all the work in process, 75% were completed throughout the month. 7. The company sold P100,000 goods for P150,000 on account. Terms: 4/15, n/30. 8. The company sold P250,000 goods for P300,000, on account. Terms: 5%, 3/10, n/30. 9. In connection with number 7, the customer paid the account on the 8th day. 10. The customer returned P40,000 goods amounting to P50,000, this was prior sold on account. 11. In connection with number 8, the customer paid on the 13th day of the month. 12. The customer returned P20,000 goods amounting to P30,000 that was sold for cash.
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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