The Balances of the Ledger Accounts for Buffet Services on September

question 91

Essay

The balances of the ledger accounts for Buffet Services on September 30, 2019, and the information needed for adjustments are shown below. Prepare the Trial Balance section, record the adjustments, and complete the worksheet.

Adjustment information:
(a)The supplies were purchased on September 1, 2019. An inventory of supplies showed $1,200 on hand on September 30, 2019.
(b)The amount of Prepaid Insurance represents a payment made September 1, 2019, for a six-month
insurance policy.
(c)The equipment, purchased September 1, 2019, has an estimated useful life of 5 years with no salvage value. The firm uses the straight-line method of depreciation.

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Definitions:

Employment-Related Expenses

Costs incurred by employees during the course of their job that are necessary and not reimbursed by the employer, possibly deductible under certain conditions.

Joint Taxpayer

Two individuals, usually married, who file a single tax return together, combining their incomes and sharing deductions.

Education Credit Deduction

A type of deduction that allows eligible taxpayers to subtract education expenses from their taxable income, enhancing affordability for higher education.

Dependent

An individual, usually a child or spouse, who relies on another person (typically a family member) for financial support and qualifies for certain tax benefits on that person’s tax return.