2. For each of these the assets involved in transactions (a) through (f), record the adjusting entry for depreciation or amortizatio expense at the end of the current year. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. > Answer is not complete. No Transaction General Journal 1 a Amortization expense Patent 2 b 3 с 4 d 5 6 Depreciation expense Accumulated depreciation No Transaction Recorded No Transaction Recorded e No Transaction Recorded f Depreciation expense Accumulated depreciation Debit Credit 4,800 4,800 12,172 12,172 2,900 2.900
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.
![P8-6 (Algo) Recording Journal Entries Related to Various Long-Lived Assets LO8-2, 8-3, 8-6
[The following information applies to the questions displayed below.]
During the current year ending on December 31, BSP Company completed the following transactions:
a. On January 1, purchased a patent for $48,000 cash (estimated useful life, ten years).
b. On January 1, purchased another business for $156,000 cash, including $8,000 for goodwill. The assets included
accounts receivable with a fair value of $12,000 and property and equipment with a fair value of $136,000 (with a
residual value of $14,280 and estimated useful life of 10 years). The company assumed no liabilities. Goodwill has
an indefinite life.
c. On December 31, constructed a storage shed on land leased from D. Heald. The cost of the shed was $26,600.
The company uses straight-line depreciation. The lease will expire in seven years. (Amounts spent to enhance
leased property are capitalized as intangible assets called Leasehold Improvements.)
d. Total expenditures for ordinary repairs were $4,800 during the current year.
e. On December 31 of the current year, sold Machine A for $7,800 cash. Original cost was $17,000; accumulated
depreciation to December 31 of the prior year was $10,400 (on a straight-line basis with a $4,000 residual value
and five-year useful life). Record the depreciation expense in transaction e(1) and the sale in transaction e(2).
f. On December 31 of the current year, paid $5,600 for a complete reconditioning of Machine B acquired on
January 1 of the prior year. Original cost, $45,400; accumulated depreciation to December 31 of the prior year
was $2,900 (on a straight-line basis with a $7,700 residual value and 13-year useful life).](https://content.bartleby.com/qna-images/question/b403227d-62c3-458e-935d-13e3651b8971/539a8429-ca70-41c3-99ed-c529410bd42c/rf14psh_processed.png)
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