Adjusting entries are made at the end of the year to adjust the financial position of the enterprise according to the accrual basis of accounting.
Accounting rules regarding journal entries:
- Balance increases when: Assets, losses, and expenses get debited and liabilities, gains, and revenue get credited.
- Balance decrease when: Assets, losses, and expenses get credited and liabilities, gains, and revenue get debited.
Journal Entries:
It is a book of original entries. It records and summarizes the financial transaction of an entity chronologically, generally according to the dual aspect of accounting.
Adjusted
It is a statement that contains balances of all account after all the adjusting entries has been made.
Income Statement:
It is a financial statement that shows the
It is a financial statement that shows the amount of profit retained by the company for future unforeseen events.
Closing Entries:
These entries are made for those items whose balance needs to be zero for the next accounting period otherwise data from two accounting periods will get mixed.
Balance sheet shows the financial position of a firm. It consists of assets, liabilities, and the
1.
To prepare: Ledger account, according to balance column format.
2.
To prepare: Journal entry and post them to ledger account.
3.
To prepare: An unadjusted trial balance.
4.
a.
To prepare: Adjusting entry.
b.
To prepare: Adjusting entry.
c.
To prepare: Adjusting entry.
d.
To prepare: Adjusting entry.
e.
To prepare: Adjusting entry.
5.
To prepare: An adjusted trial balance, income statement, statement of retained earnings and balance sheet.
6.
To prepare: Closing entries.
7.
To prepare: A post closing trial balance.
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Chapter 3 Solutions
FINANCIAL AND MANAGERIAL ACCOUNTING
- Answer?arrow_forwardThe Manager of a company is considering solution general accounting questionarrow_forwardShare-based payment transactions settled in equity are ? a) Measured at grant date fair value b) Remeasured each period c) Recorded at intrinsic value d) Measured at exercise datearrow_forward
- Nonearrow_forwardDon't give me incorrect solutionarrow_forwardDuring its first month of operation, Peter's Auto Supply Corporation, which specializes the sale of auto equipment and supplies, completed the following transactions. July Transactions July 1 Issued Common Stock in exchange for $100,000 cash. July 1 Paid $4,000 rent for the months of July and August July 2 Paid the insurance company $2,400 for a one year insurance policy, beginning July 1. July 5 Purchased inventory on account for $35,000 (Assume that the perpetual inventory system is used.) July 6 Borrowed $36,500 from a local bank and signed a note. The interest rate is 10%, and principal and interest is due to be repaid in six months. July 8 Sold inventory on account for $17,000. The cost of the inventory is $7,000. July 15 Paid employees $6,000 salaries for the first half of the month. July 18 Sold inventory for $15,000 cash. The cost of the inventory was $6,000. July 20 Paid $15,000 to suppliers for the inventory purchased on January 5. July 26…arrow_forward
- Don't want ai answerarrow_forwardPlease solve this question general accountingarrow_forwardConsider the following information. Determine the total amount of product costs. Factory utilities $17,000 Direct labor $ 73,700 Depreciation on factory equipment 13,150 Sales salaries 49,900 Depreciation on delivery trucks Property taxes on 4,300 3,300 factory building Repairs to office Indirect factory labor 50,300 2,000 equipment Indirect materials Direct materials used 82,400 Factory repairs 2,450 1,41,700 Advertising 15,600 Factory manager's salary 8,200 Office supplies used 3,510arrow_forward
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