What total amount should be reported as on December 31, 2021? adjusting events
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.
![Problem 3-14 (IFRS)
The audit of Anne Company for the year ended Decembe
31, 2021 was completed on March 1, 2022.
Th
31.
The financial statements were signed by the managin.
director on March 15, 2022 and approved by th
shareholders on March 31, 2022.
The next events had occurred.
On January 15, 2022, a customer owing P900,000 to
Anne Company filed for bankruptcy.
The financial statements included an allowance for
doubtful accounts pertaining to this customer of
P100,000.
Anne Company's issued share capital comprised 100,000
ordinary shares with P100 par value.
The entity issued additional 25,000 shares on March 1
2022 at par value.
Equipment with carrying amount of P525,000 was
destroyed by fire on December 15, 2021.
Anne Company had booked a receivable of P400,000
from the insurance entity on December 31, 2021.
After the insurance entity completed an investigation
on February 1, 2022, it was discovered that the fire
took place due to negligence of the machine operator.
As a result, the insurer's liability was zero on this
claim.
What total amount should be reported as adjusting eves
on December 31, 2021?
a. 1,300,000
b. 1,200,000
c. 3,800,000
d. 3,700,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3fbffda4-a292-49c2-9e87-e8e010b82ca6%2F1c6e9b57-5717-48f3-88a2-3d933261f664%2Fp7tbaa.jpeg&w=3840&q=75)
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