The following is the adjusted trial balance of the Toribio Cayanan Company: Toribio Cayanan Company Adjusted Trial Balance Jan. 31, 2010 Cash P 140,000 Accounts Receivable 230,000 Prepaid Rent 90,000 Office Supplies 150,000 Office Equipment 780,000 Accumulated Depreciation P 320,000 Accounts Payable 120,000 Salaries Payable 70,000 Cayanan, Capital 750,000 Cayanan, Withdrawals 170,000 Counseling Service Revenues 830,000 Miscellaneous Income 00 Salaries Expense 320,000 Office Supplies Expense 210,000 Depreciation Expense 60,000 Rent Expense 50,000 Total P2,200,000 P2,200.000 Required: 1. Prepare the closing entries. 2. Prepare a post-closing trial balance.
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
The following is the adjusted
Toribio Cayanan Company
Adjusted Trial Balance
Jan. 31, 2010
Cash P 140,000
Prepaid Rent 90,000
Office Supplies 150,000
Office Equipment 780,000
Accounts Payable 120,000
Salaries Payable 70,000
Cayanan, Capital 750,000
Cayanan, Withdrawals 170,000
Counseling Service Revenues 830,000
Miscellaneous Income 110,000
Salaries Expense 320,000
Office Supplies Expense 210,000
Depreciation Expense 60,000
Rent Expense 50,000
Total P2,200,000 P2,200,000
Required:
1. Prepare the closing entries.
2. Prepare a post-closing trial balance.
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