After the success of the company's first two months, Santana Rey continues to operate Business Solutions. The November 30, 2021, unadjusted trial balance of Business Solutions (reflecting its transactions for October and November of 2021) follows. Number 101 106 126 128 131 201 210 163 164 Accumulated depreciation-Office equipment 167 Computer equipment 168 Accumulated depreciation-Computer equipment 236 307 318 319 403 Cashi Accounts receivable Computer supplies Prepaid insurance Prepaid rent Office equipment 684 901 Account Title Accounts payable Wages payable Unearned computer services revenue Common stock Retained earnings Dividends Computer services revenue 612 Depreciation expense-office equipment 613 Depreciation expense-Computer equipment 623 637 640 652 655 676 677 Wages expense Insurance expense Rent expense Computer supplies expense Advertising expense Mileage expense Miscellaneous expenses Repairs expense-Computer Income summary Totals Debit $ 39,064 12,718 2,545 1,860 3,120 8,000 20,400 5,600 0 0 2,575 0 0 1,638 634 200 715 $ 99,069 Business Solutions had the following transactions and events in December 2021. Credit 0 0 0 0 67,000 0 32,069 0 $99,069 December 2 Paid $935 cash to Hillside Mall for Business Solutions's share of mall advertising costs. December 3 Paid $470 cash for minor repairs to company's computer. December 4 Received $4,150 cash from Alex's Engineering Company for the receivable from November. December 10 Paid cash to Lyn Addie for six days of work at the rate of $110 per day. December 14 Notified by Alex's Engineering Company that Business Solutions's bid of $7,500 on a proposed project has been accepted. Alex's paid $1,600 cash advance to Business Solutions. December 15 Purchased $2,100 of computer supplies on credit from Harris Office Products. December 16 Sent a reminder to Gomez Company to pay the fee for services recorded on November 8. December 20 Completed a project for Liu Corporation and received $6,525 cash. December 22-26 Took the week off for the holidays. December 28 Received $3,500 cash from Gomez Company on its receivable. December 29 Reimbursed S. Rey for business automobile mileage (400 miles at $0.23 per mile). December 31 Paid $1,200 cash for dividends.
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.
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