The following merchandise transactions occurred between Baker Corporation and Sugar Corporation for month of July. Required: Record each transaction on both the buyer and seller books in the journals provided. Jul 1 Baker purchased $10,000 of merchandise from Sugar. The terms were 2/10, net 30, FOB Shipping Point. Sugar's cost of merchandise sold was $6,500 Jul 3 Baker paid the freight of $250 related to the July 1 purchase Jul 8 Baker purchased $12,000 of merchandise from Sugar. The terms were 1/15, net 45, FOB Destination. Sugar's cost of merchandise sold was $7,800 Jul 9 Sugar paid the freight of $300 related to the July 8 sale Jul 11 Baker paid Sugar for the July 1 purchase Jul 19 Baker returned half the merchandise purchased on July 8 Jul 23 Baker paid Sugar for the July 8 purchase less the return on the 19th A. Baker Corporation (Buyer) JOURNAL Date Account Debit Credit Jul 1 3 8 11 19 23
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.
| The following merchandise transactions occurred between | |||||
| Baker Corporation and Sugar Corporation for month | |||||
| of July. | |||||
| Required: | |||||
| Record each transaction on both the buyer and seller books | |||||
| in the journals provided. | |||||
| Jul 1 Baker purchased $10,000 of merchandise from Sugar. | |||||
| The terms were 2/10, net 30, FOB Shipping | |||||
| Point. Sugar's cost of merchandise sold was $6,500 | |||||
| Jul 3 Baker paid the freight of $250 related to the July 1 purchase | |||||
| Jul 8 Baker purchased $12,000 of merchandise from Sugar. | |||||
| The terms were 1/15, net 45, FOB Destination. | |||||
| Sugar's cost of merchandise sold was $7,800 | |||||
| Jul 9 Sugar paid the freight of $300 related to the July 8 sale | |||||
| Jul 11 Baker paid Sugar for the July 1 purchase | |||||
| Jul 19 Baker returned half the merchandise purchased on July 8 | |||||
| Jul 23 Baker paid Sugar for the July 8 purchase less the return | |||||
| on the 19th |
| A. Baker Corporation (Buyer) | |||||||
| JOURNAL | |||||||
| Date | Account | Debit | Credit | ||||
| Jul | 1 | ||||||
| 3 | |||||||
| 8 | |||||||
| 11 | |||||||
| 19 | |||||||
| 23 | |||||||
| B. Sugar Corporation (Seller) | |||||||
| JOURNAL | |||||||
| Date | Account | Debit | Credit | ||||
| Jul | 1 | ||||||
| 8 | |||||||
| 9 | |||||||
| 11 | |||||||
| 19 | |||||||
| 23 | |||||||
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