CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

TERM REVIEWTERM REVIEW

merchandise inventory

page 418

CENTURY 21 ACCOUNTING © Thomson/South-Western

LESSON 15-2LESSON 15-2

Beginning an 8-Column Work Sheet for a Merchandising Business

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

RECORDING A TRIAL BALANCE ON A RECORDING A TRIAL BALANCE ON A WORK SHEETWORK SHEET Page 374

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221. Account title

2. Account balance

3. Total, prove, and rule the debit and credit columns

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

ANALYZING AND RECORDING SUPPLIES ANALYZING AND RECORDING SUPPLIES ADJUSTMENTSADJUSTMENTS page 376

Adj. (a) 2,730.00

Supplies Expense—Office

Dec. 31 Bal. 3,480.00 Adj. (a) 2,730.00

(Adj Bal. 750.00)

Supplies—Office

Adj. (b) 2,910.00

Supplies Expense—Store

Dec. 31 Bal. 3,944.00 Adj. (b) 2,910.00

(Adj Bal. 1,034.00)

Supplies—Store

CENTURY 21 ACCOUNTING © Thomson/South-Western

LESSON 15-1LESSON 15-1

Planning and Recording a Merchandise Inventory Adjustment

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

MERCHANDISE INVENTORYMERCHANDISE INVENTORY page 376

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

ANALYZING AND RECORDING A MERCHANDISE ANALYZING AND RECORDING A MERCHANDISE INVENTORY ADJUSTMENTINVENTORY ADJUSTMENT

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page 378

1. Write the debit amount.

3. Label the two parts of this adjustment with a small letter d in parentheses.

2. Write the credit amount.

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

ANALYZING AN ADJUSTMENT WHEN ENDING ANALYZING AN ADJUSTMENT WHEN ENDING MERCHANDISE INVENTORY IS GREATER THAN MERCHANDISE INVENTORY IS GREATER THAN BEGINNING MERCHANDISE INVENTORYBEGINNING MERCHANDISE INVENTORY page 378

Jan. 1 Bal. 294,700.00

Adj. (d) 4,200.00

(New Bal. 298,900.00)

Merchandise Inventory

Adj. (d) 4,200.00

Income Summary

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

RECORDING SUPPLIES ADJUSTMENTS RECORDING SUPPLIES ADJUSTMENTS ON A WORK SHEETON A WORK SHEET

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1. Write the debit amounts in the Adjustments Debit column.

2. Write the credit amounts in the Adjustments Credit column.

3. Label the two parts of the Supplies—Office adjustment with small letter a and small letter b in parentheses.

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CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

ANALYZING AND RECORDING A PREPAID ANALYZING AND RECORDING A PREPAID INSURANCE ADJUSTMENTINSURANCE ADJUSTMENT

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1. Enter the amount of insurance used in the Adjustments Credit column.

2. Enter the same amount in the Adjustments Debit column.

3. Label the two parts of the adjustment with a small letter c in parentheses.

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

Extending NumbersExtending Numbers

Assets, Liabilities, and Owner’s Equity Accounts are extended to the Balance Sheet Section Make sure to calculate adjusted accounts Cash to Dividends

Revenue and Expenses are extended to the Income Statement section Income Summary to Federal Income Tax Expense.

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

COMPLETING A WORK SHEETCOMPLETING A WORK SHEET

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page 430

2244 3355

1. Total the Income Statement and Balance Sheet columns.

5. Rule double lines.

4. Calculate the column totals.

3. Extend the net income amount.

2. Calculate and enter the net income after federal income tax.

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

A COMPLETED 8-COLUMN A COMPLETED 8-COLUMN WORK SHEETWORK SHEET

CENTURY 21 ACCOUNTING © Thomson/South-Western

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LESSON 15

A 10-COLUMN WORK SHEETA 10-COLUMN WORK SHEET

1. Trial balance

4466

22 33 55

5. Extend balances

2. Adjustments

3. Extend adjusted balances

4. Total, prove, and rule

6. Calculate net income; total, prove and rule

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