The following were found in our examination of the inter-plant accounts between the Home Office and the HIJ Branch: > Inventory costing P51,600 was sent to the branch by the home office on December 31, 2021. The billing was at cost, but the branch recorded the transaction at P40,800 > A branch customer erroneously remitted P3,600 to the home office. The home office recorded this cash collection on December 23, 2021. Meanwhile, back at the branch, no entry has been made yet. > A P12,000 branch remittance to the home office initiated on December 27, 2021, was recorded on the home office books on January 3, 2022 > A home office inventory shipment to the branch on December 28, 2021, was recorded by the branch on January 4, 2022; the billing of P24,000 at cost > The home office incurred P14,400 of advertising expenses and allocated P6,000 of this amount to the branch on December 15, 2021. The branch has not recorded this transaction. On December 31, 2021, the Home Office Account on HIJ Branch has a balance of P52,800. Compute the net adjustment to Home office account.
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.
Compute the net adjustment to Home office account.
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