Trident Repairs & Service, an electronics repair store, prepared the following unadjusted trial balance at the end of its first year of operations: 1 Cash 2 Accounts Receivable 3 Supplies 4 Equipment 5 Accounts Payable 6 Unearned Fees 7 Common Stock 8 Retained Earnings 9 Dividends 10 Fees Earned 11 Wages Expense 12 Rent Expense 13 Utilities Expense 14 Miscellaneous Expense 15 Totals Trident Repairs & Service UNADJUSTED TRIAL BALANCE November 30, 20Y3 ACCOUNT TITLE DEBIT 9,880.00 67,550.00 16,160.00 114,550.00 For preparing the adjusting entries, the following data were assembled: 13,210.00 94,040.00 71,870.00 52,130.00 8,040.00 447,430.00 CREDIT 15,790.00 17,600.00 9,500.00 112,710.00 291,830.00 447,430.00 • Fees earned but unbilled on November 30 were $9,890. • Supplies on hand on November 30 were $4,770. • Depreciation of equipment was estimated to be $6,470 for the year. • The balance in unearned fees represented the November 1 receipt in advance for services to be provided. During November, $15,120 of the services were provided. Unpaid Wages accrued on November 30 were $5,280. Required: 1. Journalize the adjusting entries necessary on November 30, 20Y3. Refer to the Chart of Accounts for exact wording of account titles. 2. Determine the revenues, expenses, and net income of Trident Repairs & Service before the adjusting entries. 3. Determine the revenues, expenses, and net income of Trident Repairs & Service after the adjusting entries. 4. Determine the effect of the adjusting entries on Retained Earnings.
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.
Journal Entry :— It is an act of recording transactions in books of account when transaction occurred. It is the first step in recording transactions in books of account. General Rule :—1) Debit the receiver, credit the giver. 2) Debit what comes in, credit what goes out. 3) Debit all expenses & losses, credit all income & gains.
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