Unit 6 - Cash vs Accrual Accounting Pt 2
Glossary
Accounts Payable – money the company owes its creditors
Accounts Receivable – money owed to the company by debtors
Salary Payable – money the company owes workers for outstanding wages
Interest Payable – the amount of interest yet to be paid
Telephone Payable – money owed to the telephone company
Depreciation - reduction in the value of an asset over time, mainly due to wear and tear
Accumulated Depreciation - total amount of depreciation for a fixed asset that has been charged to expense since that asset was acquired. It is an asset account that has a credit balance.
Retained Earnings - profits that a company has earned to date, less any dividends or other distributions paid to investors.
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Assignment
![](https://assets.zyrosite.com/cdn-cgi/image/format=auto,w=345,h=280,fit=crop/AE02XjOQxwf4ygbE/screenshot-2023-08-31-8.48.07-am-Yle2Mp9XvGUkbrN5.png)
![](https://assets.zyrosite.com/cdn-cgi/image/format=auto,w=328,h=278,fit=crop/AE02XjOQxwf4ygbE/screenshot-2023-08-31-8.48.07-am-Yle2Mp9XvGUkbrN5.png)
You are employed as a bookkeeper in Marias Bakery. You have the above transactions at the end of December 20x1.
Additional information for the month of December are as follows:
1. Purchased 20 bags of flour for $2000
2. Salaries paid $500
3. Mr. Charles bought 20 cakes at $1,500 to be paid for in January
4. Capital injection of $2,500.00 by Maria
Prepare relevant journals entries, ledger accounts and the trial balance, as at the end of December 20x1.
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