The December 31, 2021 adjusted trial balance section of Premier Construction's v sheet is below Adjusted Trial Balance Account Titles Dr. Cr 101 Cash 5,468 106 Accounts Receivable 19,000 115 Other Receivables 1,500 126 Supplies 500 127 Prepaid Advertising 600 131 Prepaid Rent 1,000 163 Construction Equipment 40,000 167 Office Furniture 2,000 Accounts Payable J. Doe-Capital J. Doe-Draws 7,900 60,000 201 301 303 5,000 403 Construction Income 28,950 500 Subcontractor Expense 7,900 Advertising Expense 637 600 1,790 Insurance Expense Mileage Expense 652 900 892 640 Office Expense Repairs and Maintenance Expense Supplies Expense Wages Expense Totals 1,300 1,700 2,350 8,050 676 677 684 Prepaid Insurance Rent Expense 128 2,700 3,000 655 236 Unearned Construction Income 6,400 2,400 Wages Payable Depr. Exp-Construction Equipment Accum. Depr.-Construction Equipment Depr. Exp-Office Furniture 168 210 622 1,800 164 1,800 623 71 Accum. Depr.-Office Furniture 71 Totals 107,521 107,521 Instructions 1. Enter the adjusted balances in the T-accounts.
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.
Enter the adjusted balances in the T-accounts
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