The worksheet of Bridget's Office Supplies contains the following revenue, cost, and expense accounts. The merchandise inventory amounted to $57,775 on January 1, 2019, and $50,725 on December 31, 2019. The expense accounts numbered 611 through 617 represent selling expenses, and those numbered 631 through 646 represent general and administrative expenses. Accounts 401 Sales $ 243,600 Cr. 451 Sales Returns and Allowances 4,150 Dr. 491 Miscellaneous Income 200 Cr. 501 Purchases 101,600 Dr. 502 Freight In 1,775 Dr. 503 Purchases Returns and Allowances 3,400 Cr. 504 Purchases Discounts 1,600 Cr. 611 Salaries Expense—Sales 43,300 Dr. 614 Store Supplies Expense 2,110 Dr. 617 Depreciation Expense—Store Equipment 1,310 Dr. 631 Rent Expense 11,500 Dr. 634 Utilities Expense 2,800 Dr. 637 Salaries Expense—Office 19,100 Dr. 640 Payroll Taxes Expense 4,000 Dr. 643 Depreciation Expense—Office Equipment 370 Dr. 646 Uncollectible Accounts Expense 520 Dr. 691 Interest Expense 340 Dr. The worksheet of Bridget's Office Supplies contains the following owner’s equity accounts. No additional investments were made during the period. Accounts 301 Bridget Swanson, Capital $ 61,760 Cr. 302 Bridget Swanson, Drawing 41,200 Dr. Net income for the year $48,875.Prepare a statement of owner's equity for the year ended December 31, 2019. BRIDGET'S OFFICE SUPPLIES Statement of Owner's Equity $0 $0
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 worksheet of Bridget's Office Supplies contains the following revenue, cost, and expense accounts. The merchandise inventory amounted to $57,775 on January 1, 2019, and $50,725 on December 31, 2019. The expense accounts numbered 611 through 617 represent selling expenses, and those numbered 631 through 646 represent general and administrative expenses.
| Accounts | |||||
| 401 | Sales | $ | 243,600 | Cr. | |
| 451 | Sales Returns and Allowances | 4,150 | Dr. | ||
| 491 | Miscellaneous Income | 200 | Cr. | ||
| 501 | Purchases | 101,600 | Dr. | ||
| 502 | Freight In | 1,775 | Dr. | ||
| 503 | Purchases Returns and Allowances | 3,400 | Cr. | ||
| 504 | Purchases Discounts | 1,600 | Cr. | ||
| 611 | Salaries Expense—Sales | 43,300 | Dr. | ||
| 614 | Store Supplies Expense | 2,110 | Dr. | ||
| 617 | 1,310 | Dr. | |||
| 631 | Rent Expense | 11,500 | Dr. | ||
| 634 | Utilities Expense | 2,800 | Dr. | ||
| 637 | Salaries Expense—Office | 19,100 | Dr. | ||
| 640 | Payroll Taxes Expense | 4,000 | Dr. | ||
| 643 | Depreciation Expense—Office Equipment | 370 | Dr. | ||
| 646 | Uncollectible Accounts Expense | 520 | Dr. | ||
| 691 | Interest Expense | 340 | Dr. | ||
The worksheet of Bridget's Office Supplies contains the following owner’s equity accounts. No additional investments were made during the period.
| Accounts | |||||
| 301 | Bridget Swanson, Capital | $ |
61,760 |
Cr. | |
| 302 | Bridget Swanson, Drawing |
41,200 |
Dr. | ||
Net income for the year $48,875.
Prepare a statement of owner's equity for the year ended December 31, 2019.
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