Sales and Cash Receipts Transactions Sourk Distributors is a retail business. The following sales, returns, and cash receipts occurred during March 20--. There is an 8% sales ta Mar. 1 Sale on account No. 33C to Donachie & Co., $1,700 plus sales tax. 3 Sale on account No. 33D to R. J. Kibubu, Inc., $2,190 plus sales tax. 5 Donachie & Co. returned merchandise from Sale No. 33C for a credit (Credit Memo No. 66), $40 plus sales tax. 7 Cash sales for the week were $3,140 plus sales tax. 10 Received payment from Donachie & Co. for Sale No. 33C less Credit Memo No. 66. 11 Sale on account No. 33E to Eck Bakery, $1,230 plus sales tax. 13 Received payment from R. J. Kibubu for Sale No. 33D. 14 Cash sales for the week were $4,100 plus sales tax. 16 Eck Bakery returned merchandise from Sale No. 33E for a credit (Credit Memo No. 67), $34 plus sales tax. 18 Sale on account No. 33F to R. J. Kibubu, Inc., $2,580 plus sales tax. 20 Received payment from Eck Bakery for Sale No. 33E less Credit Memo No. 67. 21 Cash sales for the week were $2,510 plus sales tax. 25 Sale on account No. 33G to Eck Bakery, $2,010 plus sales tax. 27 Sale on account No. 33H to Whitaker Group, $2,070 plus sales tax. 28 Cash sales for the week were $3,420 plus sales tax.
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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