Trial Balance Columns Of The Worksheet For Cajon Company

The trial balance columns of the worksheet for Cajon Company at June 30, 2014, are as follows. CAJON COMPANY Worksheet For the Month Ended June 30, 2014

The task involves completing a worksheet for Cajon Company as of June 30, 2014, based on the provided trial balance and adjustment data. The worksheet includes columns for trial balance, adjustments, adjusted trial balance, income statement, and balance sheet. Specific adjustments include supplies on hand, unearned revenue still unearned, and accrued salaries. The goal is to accurately prepare the worksheet, reflecting these adjustments and preparing the necessary financial statements.

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Introduction

The process of completing a worksheet for Cajon Company requires a thorough understanding of accounting principles, particularly the preparation and adjustment of trial balances, adjustments, and the creation of core financial statements. It acts as a bridge between the trial balance and the formal financial reports, ensuring accuracy and completeness before financial statements are finalized.

Preparation of the Worksheet

The initial step in the worksheet process is to set up the trial balance columns with the provided balances. For Cajon Company, the trial balance as of June 30, 2014, includes multiple account balances, such as cash, accounts receivable, supplies, and various liabilities and equity accounts. The balances are input into the respective debit and credit columns, totaling $9,460 for both sides, to verify equality.

Next, specific adjustments are to be made based on the given data:

  • Supplies on hand are valued at $500. Since supplies expense was initially recorded at $1,900, an adjustment decreases supplies expense and increases supplies, reflecting the supplies remaining at the end of the period.
  • A portion of unearned service revenue, namely $100, remains unearned. Originally, unearned revenue is recorded at $240, so the adjustment recognizes that $100 should still be classified as liability, and the earned portion should be recognized as revenue.
  • Accrued salaries of $250 need to be recorded, increasing salaries and wages expense and creating a liability for salaries payable.

Adjustments are entered into the adjustments column, and the adjusted trial balance is computed by adding or subtracting these adjustments from the original trial balances. This process ensures that the financial data reflects the true position at the end of the period.

Following this, the income statement columns are derived by summing revenues and expenses, calculating net income. Simultaneously, the balance sheet columns reflect assets, liabilities, and equity balances post-adjustment, completing the worksheet’s purpose.

Implications & Significance of Accurate Worksheets

Accuracy in completing worksheets is crucial for financial reporting, as it ensures that all financial data reflects true economic activities. Misstatements or errors can lead to incorrect financial reports, misinforming stakeholders and possibly leading to compliance issues. The worksheet serves as a critical internal control tool, detecting discrepancies before drafting final financial statements.

Conclusion

In summary, completing the Cajon Company worksheet involves creating a structured process of transferring trial balances, applying adjustments, and preparing financial statements. This process underpins sound accounting practices, ensuring transparency, accuracy, and compliance with generally accepted accounting principles (GAAP). Properly completed worksheets not only facilitate the preparation of financial reports but also enhance managerial decision-making and stakeholder confidence.

References

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