On September 1, Pat Hopkins established On a Cloud Corporation (OCC) as a provider of cloud computing services. Pat contributed $14,000 for 1,400 shares of OCC. On September 8, OCC borrowed $34,500 from a bank, promising to repay the bank in two years. On September 10, OCC wrote a check for $25,500 to acquire computer equipment. On September 15, OCC received $1,100 of supplies purchased on account and, on September 16, paid $2,450 for September rent. Through September 22, OCC billed its customers for $12,250 of services, of which OCC collected $6,450 in cash. On September 28, OCC paid $555 for Internet and phone service this month. On September 29, OCC paid wages of $4,300 for the month. Finally, on September 30, OCC submitted its electricity meter reading online and determined that the total charges for the month will be $790. This amount will be paid on October 14 through a preauthorized online payment. 1. Indicate the accounting equation effects of the September events using a table (Assets= Liabilities + Stockholders equity). Reference each transaction by date. 2. Calculate OCC's preliminary net income for September Provide well explained solution with steps and with all work. Answer in text.
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 September 1, Pat Hopkins established On a Cloud Corporation (OCC) as a provider of cloud computing services. Pat contributed $14,000 for 1,400 shares of OCC. On September 8, OCC borrowed $34,500 from a bank, promising to repay the bank in two years. On September 10, OCC wrote a check for $25,500 to acquire computer equipment. On September 15, OCC received $1,100 of supplies purchased on account and, on September 16, paid $2,450 for September rent. Through September 22, OCC billed its customers for $12,250 of services, of which OCC collected $6,450 in cash. On September 28, OCC paid $555 for Internet and phone service this month. On September 29, OCC paid wages of $4,300 for the month. Finally, on September 30, OCC submitted its electricity meter reading online and determined that the total charges for the month will be $790. This amount will be paid on October 14 through a preauthorized online payment.
1. Indicate the
2. Calculate OCC's preliminary net income for September
Provide well explained solution with steps and with all work. Answer in text.
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