The unadjusted trial balance December 31, 2018 Debit Accounts Cash $600 Office supplies 3000 Prepaid insurance 600 Equipment 24,000 Credit Accounts Accumulated Depreciation Equipment $4000 Accounts payable 2,700 Salaries Payable - Unearned Revenue 500 Common stock 10,000 Debit Dividends 3,000 Credit Service revenue 20,000 Debit Salaries expense 6,000 Supplies expenses - Depreciation Expense - equipment - Insurance expense - Total 37,200
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 unadjusted
Debit Accounts
Cash $600
Office supplies 3000
Prepaid insurance 600
Equipment 24,000
Credit Accounts
Accounts payable 2,700
Salaries Payable -
Unearned Revenue 500
Common stock 10,000
Debit Dividends 3,000
Credit Service revenue 20,000
Debit Salaries expense 6,000
Supplies expenses -
Depreciation Expense - equipment -
Insurance expense -
Total 37,200
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