ACC 331 Lecture Notes - Fall 2018 Lecture 7 - Deferred income, General ledger, Trial balance

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viridianjellyfish544

21 Sep 2018

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A list of the general ledger accounts along with their balances at a particular date, listed in the order that they appear in the ledger. Check for completeness and to verify that the sum of the accounts with debit balances equal the sum of the accounts with credit balances. Entires that are made to update accounts. To ensure that revenues and expenses are incurred in the correct period. You record revenues, when they are earned, regardless of when you receive the cash. Deferred revenue: when you get the money in advanced, before the goods/services are earned. Ex: an attorney requires you to put up a retainer, however, no legal proceedings have happened. Deferred expenses: when you pay for something in advanced, however you have not incurred the expense yet. Accrued revenues: when you"ve already done the work/service, but you haven"t been paid.

Related Questions

The general ledger of the Karlin Company, aconsulting company, at January 1, 2013, contained the following account balances:

Account Title	Debits	Credits
Cash	30,000
Accounts receivable	15,000
Equipment	20,000
Accumulated depreciation		6,000
Salaries payable		9,000
Common stock		40,500
Retained earnings		9,500

Total	65,000	65,000

The following is a summary of the transactions for theyear:

a.	Sales of services, $100,000, of which $30,000was on credit.
b.	Collected on accounts receivable, $27,300.
c.	Issued shares of common stock in exchange for$10,000 in cash.
d.	Paid salaries, $50,000 (of which $9,000 wasfor salaries payable).
e.	Paid miscellaneous expenses, $24,000.
f.	Purchased equipment for $15,000 in cash.
g.	Paid $2,500 in cash dividends to shareholders.

1.	Accrued salaries at year-end amounted to$1,000.
2.	Depreciation for the year on the equipment is$2,000.

Required:

1.	Prepare a general journal entry for each ofthe summary transactions listed above.

2.	Prepare the adjusting journal entries.

	3.	Prepare the closing entries.

4.	Post the opening balances, transactions,adjusting and closing entries into the appropriatet-accounts.

5.	Prepare an unadjusted trial balance.

6.	Prepare an adjusted trial balance.

7.	Prepare an income statement for 2013.

Prepare a balance sheet as of December 31,2013.

Prepare a post-closing trial balance.

Record (journalize) transactions in the books) Doherty Tree Cellular, Inc.,
completed the following transactions during April 2012, its first month of operations:

Apr 1	Received $19,800 and issued common stock.
2	Purchased $200 of office supplies on account.
4	Paid $14,300 cash for land to use as a building site.
6	Performed service for customers and received cash of $2,600.
9	Paid $100 on accounts payable.
17	Performed service for UFax on account totaling $1,900.
23	Collected $100 from UFax on account.
30	Paid the following expenses: salary, $1,900; rent, $1,300.

1.Record the transactions in the journal of Doherty Tree Cellular, Inc. Key transactions by date and include an explanation for each entry.

CLASS, LETS TAKE RECORDING STEP 1 STEP FURTHER - THE TRIAL BALANCE

Now that we know what the accounting equation is and we have some experience with Journal Entries.

Letâs review the process and take the recording process one step further.

STEP 1) Analyze transaction: As an actual accountant, we determine if a transaction should be recorded by analyzing source documents.

For example: If the Company makes a sale; they will complete a sales document (or sales
tape is generated). If the Company purchases something a purchase invoice is forwarded to Accounting. There is a different type of source documents for different types of transactions.

Note: as an accountant a large part of the battle is making sure there is a source document for all transactions and that all departments capture and forward these documents to Accounting!

STEP 2) Accounting prepares journal entry: for each transaction based on GAAP. (Mostly using the constraints, assumptions, principles we've discussed: materiality, conservatism, matching, revenue recognition, etc).

The entry is entered into a Journal for those types of Transactions (There is a Sales Journal, A/P Journal for purchases, Payroll journal for payroll related entries, General Journal for misc. entries., etc.

Journal entries are made in the proper form, and include: date, description, indent of credit side of each entry.

STEP 3) The Journal entry is posted to General ledger; which includes all activity for all accounts.

However, the recording process is not over. Letâs talk about the trial balance. Please answer ALL however only post ONE question at a time to allow more to participate.

1) Why do we prepare it?

apricotox859

I need help with the Post References of the Sales and Cash Journal as well as posting them to the General ledger accounts in the End of Month Posting:

Now that you have finished recording all of the transactions for the month of June, you are ready to perform the end of month posting procedure. The purpose of this end of month posting is to transfer the totals from the special journals to the appropriate general ledger accounts so that the balances in those ledger accounts reflect all of the transactions that occurred throughout the period.

Instructions for end of month posting

1)Total the columns in the special journals. Record the amount in the Total row of each journal.

2)Post the totals of the columns in the special journals to their corresponding ledger account. To confirm that the posting has been performed, a posting reference is recorded in the last row of the special journals. If the total of a column is not required to be posted, you need to record an X in the post reference field for that column.

3)Record the final unadjusted balance of each ledger account in the Unadjusted Balance row of each ledger, even for ledgers with a balance of zero. Although each ledger already has a running balance, the Unadjusted Balance row must still be filled out in order to receive full points.

SALES JOURNAL

Date		Account	Invoice No.	Post Ref.	Accounts Receivable	Sales Tax	Sales Revenue	Cost of Goods Sold
Jun	6	ARC - Great Sports	362	110-3	5,712	272	5,440	2,880
Jun	12	ARC - The Locker Room	363	110-6	21,147	1,007	20,140	9,820
Jun	17	ARC - Mick's Sporting	364	110-5	20,202	962	19,240	10,560
Jun	28	ARC - The Locker Room	365	110-6	1,197	57	1,140	600

Total					?	?	?	?
Post Reference					(?)	(?)	(?)	(?) / (?)

CASH PAYMENTS JOURNAL

Date		Account	Check No.	Post Ref.	Debit				Credit
Date		Account	Check No.	Post Ref.	Accounts Payable	Merchandise Inventory	Wages Expense	Other Accounts	Cash
Jun	3	Merchandise Inventory	731	X		3,520			3,520
Jun	4	APC - Sport Borders	732	210-4	9,500				9,500
Jun	5	Wages Payable	733	220			835	1,000	1,835
Jun	6	APC - Addax Sports	734	210-2	5,400				5,400
Jun	9	APC - Sports 'R Us	735	210-5	8,700				8,700
Jun	12	Electricity Payable	736	221				1,420	1,420
Jun	12	Wages Expense	737	X			2,384		2,384
Jun	15	Prepaid Rent	738	140				2,000	2,000
Jun	19	Wages Expense	739	X			1,695		1,695
Jun	22	APC - Extreme Sports	740	210-3	49,313				49,313
Jun	24	APC - J. J. Spud	741	210-1	10,215				10,215
Jun	26	Wages Expense	742	X			2,320		2,320
Jun	30	Merchandise Inventory	743	X		3,200			3,200
Jun	30	Salary Expense	744	545				5,300	5,300

Total					?	?	?	?	?
Post Reference					(?)	(?)	(?)	(?)	(?)

GENERAL LEDGER

Account: Cash
Account No. 100

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				65,589 DR
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: ARC - Accounts Receivable Control
Account No. 110

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				66,657 DR
Jun	30
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: Merchandise Inventory
Account No. 120

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				66,640 DR
Jun	21	Purchase return to Extreme Sports Inc	GJ		320	66,320 DR
Jun	30
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: APC - Accounts Payable Control
Account No. 210

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				78,148 CR
Jun	21	Purchase return to Extreme Sports Inc	GJ	320		77,828 CR
Jun	30
Jun	30
Jun	30					DRCR
Jun	30
Jun	30	Unadjusted Balance

Account: Sales Tax Payable
Account No. 240

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				14,073 CR
Jun	30
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: Sales Revenue
Account No. 400

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				0
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: Cost of Goods Sold
Account No. 500

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				0
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

Account: Wages Expense
Account No. 516

Date		Description	Ref.	Debit	Credit	Balance
May	31	Balance				0
Jun	30
Jun	30
Jun	30
Jun	30	Unadjusted Balance

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ACC 331 Lecture Notes - Fall 2018 Lecture 7 - Deferred income, General ledger, Trial balance

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