The following is the balance of accounts for Moon Company on Dec. 31, 2023. $24 Salaries Expense 156 Interest Expense 95 Rent Expense 5 Supplies Cash Accounts Receivable Allowance for Bad Debts Equipment Land Merchandise Inventory Building Dividends Common Stock (par $2) Sales Discount Interest Revenue Sales Sales Return Depreciation Expense Shipping Expense Supplies Expense Cost of Goods Sold 1225 60 226 1480 60 1600 15 Gross profit for the year = 8 700 45 24 12 18 150 Unrealized Holding Loss (related to long-term investment) Losses due to earthquake (pre-tax and extraordinary item) Gain on the disposition of Mexico branch (pre-tax) Accumulated other comprehensive income (credit balance) Overstatement of depreciation expense in prior year pre-tax Paid in Capital in Excess of par-Com Stock Accumulated Dep.-Office Equip Accumulated Dep.-Building Income Tax Payable Premium on Bonds Payable Accounts Payable Bonds Payable (5-year bonds) Treasury Stock (50 shares) Retained Earnings, Jan 1 Loss due to write-down of inventories The company is subject to 30% income taxes. Provide answers to the following questions. Example of Answer: 4000 (No comma, space, decimal point, or $ sign) Total operating expenses for the year = A Income from operations (operating income) A/ $110 12 42 12 30 40 20 20 60 54 120 30 12 140 90 80 1091 10
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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