Journal entries and trial balance On August 1, 20Y7, Rafael Masey established Planet Realty, which completed the following transactions during the month: Rafael Masey transferred cash from a personal bank account to an account to be used for the business in exchange for Common Stock, $32,000.
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.
On August 1, 20Y7, Rafael Masey established Planet Realty, which completed the following transactions during the month:
Rafael Masey transferred cash from a personal bank account to an account to be used for the business in exchange for Common Stock, $32,000.
Purchased supplies on account, $1,730.
Earned sales commissions, receiving cash, $26,560.
Paid rent on office and equipment for the month, $5,840.
Paid creditor on account, $640.
Paid dividends, $1,570.
Paid automobile expenses (including rental charge) for month, $1,620, and miscellaneous expenses, $1090.
Paid office salaries, $3,400.
Determined that the cost of supplies used was $960.
Required:
Question Content Area
1. Journalize entries for transactions (a) through (i), using the following account titles: Cash, Supplies, Accounts Payable, Common Stock, Dividends, Sales Commissions, Rent Expense, Office Salaries Expense, Automobile Expense, Supplies Expense, Miscellaneous Expense. If an amount box does not require an entry, leave it blank.
| Transaction | Account | Debit | Credit |
|---|---|---|---|
| a. | a. | a. | |
| - Select - | - Select - | ||
| b. | b. | b. | |
| - Select - | - Select - | ||
| c. | c. | c. | |
| - Select - | - Select - | ||
| d. | d. | d. | |
| - Select - | - Select - | ||
| e. | e. | e. | |
| - Select - | - Select - | ||
| f. | f. | f. | |
| - Select - | - Select - | ||
| g. | g. | g. | |
| - Select - | - Select - | ||
| - Select - | - Select - | ||
| h. | h. | h. | |
| - Select - | - Select - | ||
| i. | i. | i. | |
| - Select - | - Select - |
Question Content Area
2. Prepare T accounts, using the account titles in (1). Post (in chronological order) the journal entries to these accounts, selecting the appropriate letter to the left of each amount to identify the transactions. Determine the account balances, after all posting is complete. Accounts containing only a single entry do not need a balance.
Cash| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
| Bal. |
Supplies
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
| fill in the blank 16 of 41
a.b.c.d.e.f.g.h.i. |
fill in the blank 17 of 41 | fill in the blank 18 of 41
a.b.c.d.e.f.g.h.i. |
fill in the blank 19 of 41 |
| Bal. | fill in the blank 20 of 41 |
Accounts Payable
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
| Bal. |
Common Stock
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
Dividends
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
Sales Commissions
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
Rent Expense
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
Office Salaries Expense
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
Automobile Expense
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
Supplies Expense
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
Miscellaneous Expense
| Transaction | Debit amount | Transaction | Credit amount |
|---|---|---|---|
Question Content Area
3. Prepare an unadjusted trial balance as of August 31, 20Y7. List all accounts in the order of Assets, Liabilities,
| Account | Debit Balances | Credit Balances |
|---|---|---|
| Total | Total | Total |
Question Content Area
4. Determine the following:
a. Amount of total revenue recorded in the ledger.
fill in the blank 1 of 1$
b. Amount of total expenses recorded in the ledger.
fill in the blank 1 of 1$
c. Amount of net income for August.
fill in the blank 1 of 1$
5. Determine the increase or decrease in
fill in the blank 1 of 1$
IncreaseDecrease
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