The general ledger of Jackrabbit Rentals at January 1, 2021, includes the following account balances: Accounts Debits Credits Cash $ 45,500 Accounts Receivable 29,700 Land 114,800 Accounts Payable 15,700 Notes Payable (due in 2 years) 34,000 Common Stock 104,000 Retained Earnings 36,300 Totals $ 190,000 $ 190,000 The following is a summary of the transactions for the year: 1. January 12 Provide services to customers on account, $66,400. 2. February 25 Provide services to customers for cash, $77,300. 3. March 19 Collect on accounts receivable, $46,100. 4. April 30 Issue shares of common stock in exchange for $34,000 cash. 5. June 16 Purchase supplies on account, $12,900. 6. July 7 Pay on accounts payable, $11,700. 7. September 30 Pay salaries for employee work in the current year, $68,200. 8. November 22 Pay advertising for the current year, $22,900. 9. December 30 Pay $3,300 cash dividends to stockholders. The following information is available for the adjusting entries. Accrued interest on the notes payable at year-end amounted to $2,900 and will be paid January 1, 2022. Accrued salaries at year-end amounted to $1,900 and will be paid on January 5, 2022. Supplies remaining on hand at the end of the year equal $2,700. 11. Prepare a post-closing trial balance.
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.
The general ledger of Jackrabbit Rentals at January 1, 2021, includes the following account balances:
| Accounts | Debits | Credits | |||||
| Cash | $ | 45,500 | |||||
| 29,700 | |||||||
| Land | 114,800 | ||||||
| Accounts Payable | 15,700 | ||||||
| Notes Payable (due in 2 years) | 34,000 | ||||||
| Common Stock | 104,000 | ||||||
| 36,300 | |||||||
| Totals | $ | 190,000 | $ | 190,000 | |||
The following is a summary of the transactions for the year:
| 1. | January | 12 | Provide services to customers on account, $66,400. | |||
| 2. | February | 25 | Provide services to customers for cash, $77,300. | |||
| 3. | March | 19 | Collect on accounts receivable, $46,100. | |||
| 4. | April | 30 | Issue shares of common stock in exchange for $34,000 cash. | |||
| 5. | June | 16 | Purchase supplies on account, $12,900. | |||
| 6. | July | 7 | Pay on accounts payable, $11,700. | |||
| 7. | September | 30 | Pay salaries for employee work in the current year, $68,200. | |||
| 8. | November | 22 | Pay advertising for the current year, $22,900. | |||
| 9. | December | 30 | Pay $3,300 cash dividends to stockholders. |
The following information is available for the
Accrued interest on the notes payable at year-end amounted to $2,900 and will be paid January 1, 2022. Accrued salaries at year-end amounted to $1,900 and will be paid on January 5, 2022. Supplies remaining on hand at the end of the year equal $2,700.
11. Prepare a post-closing
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