Adjustments and the - MCCC

[Pages:40]5-1

McGraw-Hill

Chapter

5

Adjustments and the Worksheet

Section 1: The Worksheet

Section Objectives

1. Complete a trial balance on a worksheet.

2. Prepare adjustments for unrecorded business transactions.

? 2009 The McGraw-Hill Companies, Inc. All rights reserved.

Objective 1

The worksheet has an Account Name column

Complete a trial balance on a worksheet

The worksheet also has five sections.

Each section has two columns.

ACCOUNT NAME

JT's Consulting Services Worksheet

Month Ended December 31, 2010

TRIAL BALANCE DEBIT CREDIT

ADJUSTMENTS ADJ. TRIAL BAL. INCOME STMT. BALANCE SHEET DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT

5-3

Complete the Trial Balance section in four steps

1. Enter the general ledger account names. 2. Transfer the general ledger account balances to the Debit

and Credit columns of the Trial Balance section. 3. Total the Debit and Credit columns to prove that the trial

balance is in balance. 4. Place a double rule under each Trial Balance column to

show that the work in that column is complete.

5-4

Step 1: Enter the general ledger account names.

JT's Consulting Services Step 1: Enter the general ledger acWcooruknsthneaemt es.

Month Ended December 31, 2010

ACCOUNT NAME

Cash

TRIAL BALANCE ADJUSTMENTS ADJ. TRIAL BAL.

Carter Consulting Service DEBIT CREDIT DWEBoIrTkshCeReEtDIT DEBIT

Month Ended December 31, 2004

CREDIT

INCOME STMT. DEBIT CREDIT

BALANCE SHEET DEBIT CREDIT

Accounts Receivable

Supplies

ACCOUNT NAME

Prepaid Rent

TRIAL BALANCE DEBIT CREDIT

EquipCmasehnt

Accum. Depr.--Equip.

Accounts Payable

Jason Taylor, Cap.

ADJUSTMENTS ADJ. TRIAL BAL. INCOME STATEMENT BALANCE SHEET

DEBIT CREDIT DEBIT CREDIT

DEBIT CREDIT

DEBIT CREDIT

These four new accounts will be used for the adjustments.

Jason Taylor, Draw.

Fees Income Salaries Expense Utilities Expense Supplies Expense Rent Expense Depr. Exp.--Equip. Totals

**If additional new expense accounts are needed in the adjustment process, add them to the bottom of the ACCOUNT NAME column.

5-5

Step 2: Transfer the general ledger account balances to the Debit and Credit columns of the Trial Balance section.

JT's Consulting Services Worksheet

Month Ended December 31, 2010

TRIAL BALANCE

ACCOUNT NAME

Cash

DEBIT CREDIT

83,500

Accounts Rec.

Supplies Prepaid Rent Equipment Accum. Depr.

Accounts Pay. J. Taylor, Cap. J. Taylor, Draw.

ADJUSTMENTS

ADJ. TRIAL BAL.

DEBIT CREDIT DEBIT CREDIT

INCOME STMT. BALANCE SHEET DEBIT CREDIT DEBIT CREDIT

ACCOUNT __C_a_s__h______________________ ACCOUNT NO. __1_0_1____

5-6

DATE DESCRIPTION

2010 Nov. 30 Bal. forward

POST REF.

DEBIT

Dec. 31

J2 26,000

Dec. 31

J2

4,000

Dec. 31

J2

Dec. 31

J2

Dec. 31

J2

CREDIT

7,000 500

4,000

BALANCE

DEBIT

CREDIT

64,6450,0000

91,000 95,000 88,000 87,500 83,500

Step 3: Total the Debit and Credit columns to prove that the trial balance is in balance.

ACCOUNT NAME

TRIAL BALANCE ADJUSTMENTS ADJ. TRIAL BAL.

INCOME STMT.

BALANCE SHEET

DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT

Cash

83,500

Accounts Receivable 5,000

Supplies

3,000

Prepaid Rent Equipment

7,000 22,000

Accum. Depr.--Equip.

Step 4: Place a double rule under each Trial Balance column to show that the work in that column is complete.

Accounts Payable

7,000

Jason Taylor, Cap.

90,000

Jason Taylor, Draw. Fees Income Salaries Expense Utilities Expense

4,000 35,000

7,000 500

Supplies Expense

Rent Expense

Depr. Exp.--Equip.

Totals

132,000 132,000 5-7

Objective 2

Prepare adjustments for unrecorded business transactions

ACCOUNT NAME

TRIAL BALANCE DEBIT CREDIT

Cash

83,500

Accounts Receivable Supplies Prepaid Rent Equipment

5,000 3,000 7,000 22,000

Accum. Depr.--Equip. Accounts Payable

7,000

Jason Taylor, Cap.

90,000

Jason Taylor, Draw. Fees Income Salaries Expense Utilities Expense

4,000 35,000

7,000 500

Supplies Expense

Rent Expense

Depr. Exp.--Equip.

Totals

132,000 132,000

ADJUSTMENTS ADJ. TRIAL BAL.

INCOME STMT.

BALANCE SHEET

DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT

These adjusting entries are first entered in the Adjustments section of the worksheet.

5-8

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download