Trial Balance The accounts in the ledger of Hickory Furniture Company as of December 31, 2019, are listed in alphabetical order as follows. All accounts have normal balances. The balance of the cash account has been intentionally omitted. Accounts Payable $42,770 Accounts Receivable 116,900 Cash ? Elaine Wells, Capital 75,000 Elaine Wells, Drawing 24,000 Fees Earned 745,230 Insurance Expense 3,600 Land 50,000 Miscellaneous Expense 9,500 Notes Payable 50,000 Prepaid Insurance 21,600 Rent Expense 48,000 Supplies 4,275 Supplies Expense 6,255 Unearned Rent 12,000 Utilities Expense 26,850 Wages Expense 580,700 Prepare an unadjusted trial balance, listing the accounts in their normal order and inserting the missing figure for cash. For those boxes in which no entry is required, leave the box blank.
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 accounts in the ledger of Hickory Furniture Company as of December 31, 2019, are listed in alphabetical order as follows. All accounts have normal balances. The balance of the cash account has been intentionally omitted.
| Accounts Payable | $42,770 |
| 116,900 | |
| Cash | ? |
| Elaine Wells, Capital | 75,000 |
| Elaine Wells, Drawing | 24,000 |
| Fees Earned | 745,230 |
| Insurance Expense | 3,600 |
| Land | 50,000 |
| Miscellaneous Expense | 9,500 |
| Notes Payable | 50,000 |
| Prepaid Insurance | 21,600 |
| Rent Expense | 48,000 |
| Supplies | 4,275 |
| Supplies Expense | 6,255 |
| Unearned Rent | 12,000 |
| Utilities Expense | 26,850 |
| Wages Expense | 580,700 |
Prepare an unadjusted trial balance, listing the accounts in their normal order and inserting the missing figure for cash. For those boxes in which no entry is required, leave the box blank.
The correct order of accounts in an Unadjusted trial balance is as follows -
Assets, Liabilities, Owner's Equity, Revenues, Expenses
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