Mr. Stephen Fury, an experienced academic professor, aims to level the level of knowledge of students and cope up with the standardized delivery of academic programs in schools. SuperBrains Tutorial offers after class lessons focused on English, Math, and Sciences. Presented below are the unadjusted account balances of the company from January 1 to December 31, 2020. Debit Credit Cash P285,000 Accounts Receivable Allowance for Doubtful Accounts 67,000 P5,360 Prepaid rent Furniture and Fixtures 27,000 38,800 Accounts Payable Unearned Service Revenue 20,000 23,000 Fury, Withdrawals Fury, Capital Service Revenue 78,000 507,440 250,000 190,000 Salaries Expense Utilities Expense Supplies Expense 20,000 70,000 Commissions and Bonuses 30,000 Additional information: 1. Based on past collection data, about 3% of credit service revenue is uncollectible. 70% of service revenue came from cash services. 2. Unexpired portion of prepaid rent at the end of the year amounts to P8,000. 3. Furniture and fixtures was purchased on August 31, 2020. It is expected to benefit the company for three years with a disposable value of P10,000. 4. Unrecorded payment of accounts payable, P15,000. 5. Unearned service revenue should be P15,000. 6. P20,000 of supplies expense are still unused.
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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