The following transactions occurred during the company's first month. June 1 The owner invested $32,000 cash and vehicle worth $26,000 in the company. 2 The company rented furnished office space by paying $7,800 cash for the 6 month's rent in advance. 3 The company purchased $2,500 of office supplies for cash. 7 The company purchased goods for $4,500 on account. 10 The company paid $2,160 cash for the premium on a 6-month insurance policy. 16 The company sold goods for $4,050 by receiving a promissory note. 19 The company purchased goods for $2,250 in cash. 20 The company collected $1,600 cash for the services that will be rendered in coming days. 23 The company sold goods for $2,760 on account. 28 The company paid $4,400 cash for salaries earned by employees. 29 The company paid $750 cash for minor repairs to the company's vehicle. 30 The company paid $550 cash for this month's telephone bill, 30 The owner withdrew $1,200 cash from the company for personal use. Use the following information to journalize and post adjusting entries for the month: a. One month's insurance coverage has expired and one month's rent has expired. b. At the end of the month, $700 of office supplies are still available. c. This month's depreciation on the computer equipment is $500. d. Employees carned $520 of unpaid and unrecorded salaries as of month-end. c. The company earned $1,300 of advanced collection made on June 20. f. The company earned $3,050 of commissions that are not yet billed at month-end. g. Cost of goods on hand as of June 30, 2017 is S1,250.
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.
Record transaction, prepare
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