. The ending balances in the income statement accounts (revenues and expenses) are closed after the year's financial statements are prepared and these accounts will start the next accounting period with zero balances. 13 30,000, Prepaid Insurance. amount shown as Supplies on Hand in the Balance Sheet columns is a: The cash basis of accounting is acceptable primarily in enterprises that do not have. . At the end of an accounting period, the consumable supplies on hand are counted and amount used is recorded as an expense in the income statement using an adjusting entry. . . . <>

. . . 11 0 obj . . . . . . . . . . E�98�z��������,/� }���&e濓�Wmb̷QU-�&0�ݦpZ8f\��p�k��75�fTp�\$ЦTL�û�PZ��T9��Kt����Pͽ�R#u@ $qW�b\��Sa�p��QE����=�� ��V��!vl�^�N'ʦ9+��'�w����qB0�{S0݌�dN#CXC���>����a����A�w�g�1]��m�~�|8��¿��X*lGO�:�0Mn��Ï{�b�fg�Ro� �21X���Q���Ֆ���4H�Faa�����(66)���J�����"�ov��&\���m���WoM��[w�+Fi��S �cD��k�@7v �P��\+eI�a탨}�U��UQ�j��S��f^n��4�C���cE���P�����&�`�!Cj�ê�� ;�%���f^[4����-LK�� :^�6�y�` �����u�|����jJ�o9�9�tC��X��1��{��R8�2�,D��B���R�0UP��6����75�*0� a���T�řB��B�/�]IT�n/!��¥�{�Hg��3�c�����Ll� ������ . This preview shows page 1 - 3 out of 4 pages. . (This could occur because some customers will have unforeseen hardships, some customers might be dishonest, etc.) . . Accumulated Depreciation - Equipment $7,500. . . . . However, under the accrual basis of accounting, the balance sheet must report all the amounts the company has an absolute right to receive—not just the amounts that have been billed on a sales invoice. . . . . This means that the preliminary balance is too high by $375 ($1,100 minus $725). endobj

. . Stuck? . .

. . ), Indicate the account titles on each of the T-accounts. . . . . The balance in Insurance Expense starts with a zero balance each year and increases during the year as the account is debited. . 17 25,000, Trucks.

. . . .

. Balance Sheet: A balance sheet is a financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific point in time. We have tutors online 24/7 who can help you get unstuck. Record the closing entries on Page 27 of the journal. . . . . After further review, it is learned that $3,000 of work has been performed (and therefore has been earned) as of December 31 but won't be billed until January 10. . 10 0 obj . . . the Office Supplies (asset) account to the Supplies Expense account. . Record the adjusting entries on Page 26 of the journal. . The decline in usefulness of a plant asset is an expense, and accountants systematically spread the asset's cost over its useful life. . .

. Plant assets are long-lived tangible assets used in the operation of a business. . . . . . . . . . Supplies on hand at March 31 are $7,500. . . . . . .

. . . The unadjusted trial balance of Lakota Freight Co. at March 31, 2019, the end of the year, follows: Lakota Freight Co. Unadjusted Trial Balance March 31, 2019 Debit   Balances Credit   Balances, Cash . . . . . . .

. . To determine if the balance in this account is accurate the accountant might review the detailed listing of customers who have not paid their invoices for goods or services. . . . . . A reasonable way to begin the process is by reviewing the amount or balance shown in each of the balance sheet accounts. . . . . . .

. . . . . . . False Answer Key: False Question 3 of 10 10.0/ 10.0 Points Supplies on Hand are shown as $315 in the Trial Balance columns of the work sheet. . . . . . <>/Font<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 720 540] /Contents 13 0 R/Group<>/Tabs/S/StructParents 1>> Supplies Expense will start the next accounting year with a zero balance. When a business purchases consumable supplies such as stationary, it records these as supplies on hand in the balance sheet of the business.

. . Southern New Hampshire University • ACCOUNTING 118, Columbia Southern University • ACCOUNTING bba2201, Dunwoody College of Technology • ACCOUNTING 10, Southern New Hampshire University • ACC 201, Osceola High School, Seminole • AP PYSCH 101, Southern New Hampshire University • ACCOUNTING ACC-201-X3, 2-2 MyAccountingLab Homework_ Chapters 3 and 4-Steven Davis.pdf. 19 15,000 Accounts Payable . Generally Accepted Accounting Principles. However, a count of the supplies actually on hand indicates that the true amount of supplies is $725. . substantial credit transactions or inventories.

. . . .

. . . Prepare an income statement, a statement of owner’s equity (no additional investments were made during the year), and a balance sheet. . . The balance sheet is based on the fundamental equation: Assets = Liabilities + Equity Using this template, you can add and remove line items under ea . c. Depreciation of equipment during the year is $8,350. . . . . The correct amount is the amount that has been paid by the company for insurance coverage that will expire after the balance sheet date. . The amount shown as Supplies on Hand in the Balance Sheet columns is a: A.$25 debit. It not only provides all the essential material to succeed in learning accounting and finance, but also explains all the relevant details that make the difference when you need to understand the complexity of accounting systems. . . . <>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 720 540] /Contents 4 0 R/Group<>/Tabs/S/StructParents 0>> .

. B.$315 debit. . . . . . However, the balances are likely to be different from one another. third general purpose financial statement prepared during the accounting cycle

. endobj . . As a communication trainer and business coach, I had to pick up the language of accounting in no time in order to communicate more effectively with my clients. 4 0 obj . . 12 0 obj . One account to be debited and one account to be credited. The Supplies account has a preliminary balance of $1,100. endobj

. . ... Retotal the Income Statement columns and the Balance Sheet columns as an arithmetic check. Insurance premiums expired during the year are $1,800. <> . . <> . . . . . . Date Accounts and Explanation Debit Credit Dec. 31 Supplies Expense 150 Adj. . .

. .

. The correct balance should be the cumulative amount of depreciation from the time that the equipment was acquired through the date of the balance sheet. 24 . . The amount shown as Supplies on Hand in the Balance Sheet columns is a: A.$25 debit. . . Copyright © 2020 AccountingCoach, LLC. . . 7 0 obj .

. . . (There are likely to be several accounts or sub-accounts in order keep track of the manufacturing supplies by category.) . This means that the balance in Allowance for Doubtful Accounts should be reported as a $600 credit balance instead of the preliminary balance of $0. .

x��VMO1����a�6Ɵ뵄�J��"�6���4,$mh>Z��g7[;���e�������{6�\���I�su���/:�'�8p�9RrVr0�üʳ�#�噀�v��:�tw�g_�.�� �h����� %"{w> F�`�̕Л��D��O:��#-Ȓ All expenses will go to reduce owner's equity Determine what the ending balance ought to be for the balance sheet account. . See the major topic Bank Reconciliation for a thorough discussion and illustration of the likely journal entries.). . You are already subscribed. (Optional) Enter the unadjusted trial balance on an end-of-period spreadsheet and complete the spreadsheet. . . 2 0 obj .

. 1 0 obj 18 60,000, Accumulated Depreciation—Trucks . .

. . . . 7. Many thanks for your great support." . endobj . C.$290 debit. Course Hero is not sponsored or endorsed by any college or university. . . . . (It's common not to list accounts with $0 balances on balance sheets.

True B. . .

.

At the end of the accounting year, the ending balances in the balance sheet accounts (assets and liabilities) will carry forward to the next accounting year.

. . . . . . . . The cost of equipment is recorded in the account Equipment. .

. <> . . . . . . At the end of an accounting period, the consumable supplies on hand are counted and amount used is recorded as an expense in the income statement using an adjusting entry. .
.

. . . Instructions. . . . . . When those open invoices are sorted according to the date of the sale, the company can tell how old the receivables are. . These three balance sheet … . . . The report form, on the other hand, only has one column. C.$290 debit.

Course Hero is not sponsored or endorsed by any college or university. . . .

Why? 3 0 obj . Bad Debts Expense will start the next accounting year with a zero balance. . However, Accounts Receivable will decrease whenever a customer pays some of the amount owed to the company.
Depr.—Equip. This means that the preliminary balance is too high by $375 ($1,100 minus $725). (If the preliminary balance in Cash does not agree to the bank reconciliation, entries are usually needed. . .

.

. . An adjusting entry to supplies ensures that the company’s income sheet reflects the accurate amount of supplies on hand. . . . . All other amounts should be charged to Insurance Expense. 16 110,000, Accumulated Depreciation Equipment. . <> ACCT105 WK3 Quiz AMU - 10.0 10.0 Points Question 1 of 10 Many accounting measurements are estimates and involve approximation and judgment A True B, 127 out of 129 people found this document helpful. . . . . .

Exp.—Equipment (c) 8,350 8,350 8,350, 300,000 300,000 39,450 39,450 315,150 315,150 108,850 160,000 206,300 155,150, 31 Depreciation Expense—Equipment 55 8,350, Accumulated Depreciation—Equipment 17 33,350, Accumulated Depreciation—Trucks 19 21,200, Kaya Tarango, capital, April 1, 2018$ 96,000, Kaya Tarango, capital, March 31, 2019$132,150, Less accumulated depreciation 33,350 $76,650, Less accumulated depreciation 21,200 38,800, Total property, plant, and equipment115,450, Total liabilities and owner’s equity$136,750. Accumulated Depreciation - Equipment is a contra asset account and its preliminary balance of $7,500 is the amount of depreciation actually entered into the account since the Equipment was acquired. .

endobj

Recall that depreciation on equipment amounts to, for the month and depreciation on furniture amounts to, (Prepare a single compound journal entry.). . . . the assets, their value and usefulness decline. .

The balance in the asset Supplies at the end of the accounting year will carry over to the next accounting year.


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