question archive Instructions Chart of Accounts Asset Accounts Liability Accounts Equity Accounts Acct # Acct # Acct # Cash 101 Notes Payable 201 Common Stock 301 Baking Supplies 102 Accounts Payable 202 Dividends 302 Prepaid Rent 103 Wages Payable 203 Prepaid Insurance 104 Interest Payable 204 Baking Equipment 105 Misc
Subject:BusinessPrice: Bought3
Asset Accounts | Liability Accounts | Equity Accounts | |||
Acct # | Acct # | Acct # | |||
Cash | 101 | Notes Payable | 201 | Common Stock | 301 |
Baking Supplies | 102 | Accounts Payable | 202 | Dividends | 302 |
Prepaid Rent | 103 | Wages Payable | 203 | ||
Prepaid Insurance | 104 | Interest Payable | 204 | ||
Baking Equipment | 105 | ||||
Misc. Supplies | 106 | ||||
Accounts Receivable | 107 | ||||
Accumulated Depreciation | 108 | ||||
Merchandise Inventory | 109 | Revenue Accounts | |||
This chart of accounts should help you identify the appropriate accounts to record to as you are analyzing and journaling transactions for this workbook. There is nothing to complete on this page; this is simply a resource for you. | Acct # | ||||
Bakery Sales | 401 | ||||
Merchandise Sales | 402 | ||||
Expense Accounts | |||||
Acct # | |||||
Baking Supplies Expense | 501 | ||||
Rent Expense | 502 | ||||
Insurance Expense | 503 | ||||
Misc. Expense | 504 | ||||
Business License Expense | 505 | ||||
Advertising Expense | 506 | ||||
Wages Expense | 507 | ||||
Telephone Expense | 508 | ||||
Interest Expense | 509 | ||||
Depreciation Expense | 510 | ||||
Misc. Supplies Expense | 511 | ||||
Cost of Goods Sold | 512 |
Peyton Approved | |||
General Journal Entries | |||
Jul-14 | |||
Date | Accounts | Debit | Credit |
1-Jul | Cash | 15,000.00 | |
Common Stock | 15,000.00 | ||
Contributed cash for common stock | |||
1-Jul | Baking Suppllies | 8,500.00 | |
Vendor | 8,500.00 | ||
To record Baking Supplies purchased | |||
3-Jul | Cash | 10,000.00 | |
Notes Payable | 10,000.00 | ||
To record loan from parents | |||
7-Jul | Lease Expense Advance | 1,500.00 | |
Cash | 1,500.00 | 3,000.00 | |
To Record Lease Agreements | |||
10-Jul | Business License | 375.00 | |
Cash | 375.00 | ||
To record Buisness License Fee | |||
11-Jul | Miscellaneous Expense | 250.00 | |
Cash | 250.00 | ||
To record Misc. Exp. cash resgister | |||
13-Jul | Baking Equipment | 5,000.00 | |
Common Stock | 5,000.00 | ||
To record purchase baking equipment | |||
13-Jul | Advertising Expense | 200.00 | |
Cash | 200.00 | ||
To record Advertising Expense | |||
14-Jul | Miscellaneous Supplies | 300.00 | |
Cash | 300.00 | ||
To record Misc. Supplies | |||
15-Jul | No Entry Required | ||
30-Jul | Telephone Expenses | 45.00 | |
Accounts Payable | 45.00 | ||
To record Telephone expense | |||
31-Jul | Prepaid Insurance | 1,200.00 | |
Cash | 1,200.00 | ||
To record Insurance payment | |||
31-Jul | Wages Expenses | 120.00 | |
Wages payble | 120.00 | ||
To record Wage expense | |||
31-Jul | Cash | 10,000.00 | |
Accounts Receivable | 5,000.00 | ||
Bakery Sales | 15,000.00 | ||
Peyton Approved | |||
General Journal Entries | |||
Aug-14 | |||
Date | Accounts | Debit | Credit |
31-Jul | Wages Expense | 120.00 | |
Wages Payable | 120.00 | ||
To record Wage expense | |||
8-Aug | Cash | 3,200.00 | |
Accounts Receivable | 3,200.00 | ||
10-Aug | Telephone Expense | 45.00 | |
Cash | 45.00 | ||
To record Telephone expense | |||
15-Aug | Baking Supplies | 5,000.00 | |
Accounts Payables | 5,000.00 | ||
15-Aug | Wages Expense | 480.00 | |
Wages Payable | 480.00 | ||
To record Wage expense | |||
15-Aug | Rent Expense | 1,500.00 | |
Cash | 1,500.00 | ||
18-Aug | Cash | 1,000.00 | |
Accounts Receivables | 1,000.00 | ||
20-Aug | Accounts Payables | 8,500.00 | |
Cash | 8,500.00 | ||
20-Aug | Wages Expense | 480.00 | |
Cash | 480.00 | ||
22-Aug | Miscellaneous Supplies | 300.00 | |
Cash | 300.00 | ||
31-Aug | Cash | 45.00 | |
Telephone Expenses | 45.00 | ||
31-Aug | Wage Expenses | 420.00 | |
Wages Payable | 420.00 | ||
Cash | 12,500.00 | ||
Accounts Receivable | 7,500.00 | ||
Bakery Sales | 20,000.00 | ||
Peyton Approved | |||
General Journal Entries | |||
Sep-14 | |||
Date | Accounts | Debit | Credit |
1-Sep | Dividends | 3,000.00 | |
Cash | 3,000.00 | ||
5-Sep | Salary and Wages Payable | 420.00 | |
Cash | 420.00 | ||
7-Sep | Merchandise Inventory | 60.00 | |
Cash | 60.00 | ||
8-Sep | Cash | 4,000.00 | |
Accounts Receivable | 4,000.00 | ||
10-Sep | Accounts Payable | 45.00 | |
Cash | 45.00 | ||
11-Sep | Baking Supplies | 7,000.00 | |
Accounts Payable | 7,000.00 | ||
13-Sep | Accounts Payable | 5,000.00 | |
Cash | 5,000.00 | ||
15-Sep | Wages Expense | 456.00 | |
Wages Payable | 456.00 | ||
15-Sep | Rent Expense | 1,500.00 | |
Cash | 1,500.00 | ||
15-Sep | Cash | 68.00 | |
Merchandise Sales revenue | 68.00 | ||
15-Sep | Cost of goods sold | 48.00 | |
Merchandise Inventory | 48.00 | ||
20-Sep | Wages Payable | 456.00 | |
Cash | 456.00 | ||
20-Sep | Merchandise Inventory | 122.00 | |
Cash | 122.00 | ||
24-Sep | Cash | 153.00 | |
Merchandise Sales Revenue | 153.00 | ||
24-Sep | Cost of goods sold | 109.60 | |
Merchandise Inventory | 109.60 | ||
30-Sep | Merchandise Inventory | 151.25 | |
Cash | 151.25 | ||
30-Sep | Wages Expense | 480.00 | |
Wages Payable | 480.00 | ||
30-Sep | Cash | 6,000.00 | |
Accounts Receivable | 19,000.00 | ||
Bakery Sales | 25,000.00 | ||
FIFO | Purchases | |||||||||
Date | Purchases | Sales | Ending Inventory | Dr | Cr | 9/7: 10 bottles purchased at $6 | ||||
7-Sep | 10 | $ 6.00 | $ 60.00 | 10 | $ 6.00 | $ 60.00 | 7-Sep | Merchandise Inventory (10 x $6) | 60.00 | 9/20: 20 bottles purchased at $6.10 |
Cash | 60.00 | 9/30: 25 bottles purchased at $6.05 | ||||||||
15-Sep | 8 | $ 6.00 | $ 48.00 | 2 | $ 6.00 | $ 12.00 | Purchased inventory | Sales – selling price, $8.50 a bottle | ||
9/15: 8 bottles | ||||||||||
20-Sep | 20 | $ 6.10 | $ 122.00 | 2 | $ 6.00 | $ 12.00 | 15-Sep | Cash (8 x $8.50) | 68.00 | 9/24: 18 bottles |
20 | $ 6.10 | $ 122.00 | Merchandise Sales Revenue | 68.00 | ||||||
22 | $ 134.00 | Record sale of inventory | ||||||||
24-Sep | 2 | $ 6.00 | $ 12.00 | 15-Sep | Cost of Goods Sold (8 X $6) | 48.00 | ||||
16 | $ 6.10 | $ 97.60 | 4 | $ 6.10 | $ 24.40 | Merchandise Inventory | 48.00 | |||
$ 109.60 | Recorded the cost of goods sold | |||||||||
30-Sep | 25 | $ 6.05 | $ 151.25 | 4 | $ 6.10 | $ 24.40 | 20-Sep | Merchandise Inventory (20 x $6.10 ) | 122.00 | |
25 | $ 6.05 | $ 151.25 | Cash | 122.00 | ||||||
29 | $ 175.65 | |||||||||
55 | $ 333.25 | 26 | $ 157.60 | 29 | $ 175.65 | 24-Sep | Cash (18 x 8.50) | 153.00 | ||
Merchandise Sales Revenue | 153.00 | |||||||||
Record sale of inventory | ||||||||||
24-Sep | Cost of Goods Sold (2 x $6)+(16 x $6.10) | 109.60 | ||||||||
Merchandise Inventory | 109.60 | |||||||||
Recorded the cost of goods sold | ||||||||||
30-Sep | Merchandise Inventory (25 x $6.05) | 151.25 | ||||||||
Cash | 151.25 | |||||||||
LIFO | Purchases | Sales | Ending Inventory | 7-Sep | Merchandise Inventory (10 x $6) | 60.00 | ||||
7-Sep | 10 | $ 6.00 | $ 60.00 | 10 | $ 6.00 | $ 60.00 | Cash | 60.00 | ||
Purchased inventory | ||||||||||
15-Sep | 8 | $ 6.00 | $ 48.00 | 2 | $ 6.00 | $ 12.00 | ||||
15-Sep | Cash (8 x $8.50) | 68.00 | ||||||||
20-Sep | 20 | $ 6.10 | $ 122.00 | 2 | $ 6.00 | $ 12.00 | Merchandise Sales Revenue | 68.00 | ||
20 | $ 6.10 | $ 122.00 | Record sale of inventory | |||||||
22 | $ 134.00 | |||||||||
15-Sep | Cost of Goods Sold (8 X $6) | 48.00 | ||||||||
24-Sep | 18 | $ 6.10 | $ 109.80 | 2 | $ 6.00 | $ 12.00 | Merchandise Inventory | 48.00 | ||
2 | $ 6.10 | $ 12.20 | Record inventory reduction due to sale | |||||||
4 | $ 24.20 | |||||||||
20-Sep | Merchandise Inventory (20 x $6.10) | 122.00 | ||||||||
30-Sep | 25 | $ 6.05 | $ 151.25 | 2 | $ 6.00 | $ 12.00 | Cash | 122.00 | ||
2 | $ 6.10 | $ 12.20 | ||||||||
25 | $ 6.05 | $ 151.25 | 24-Sep | Cash (18 x 8.50) | 153.00 | |||||
29 | $ 175.45 | Merchandise Sales Revenue | 153.00 | |||||||
55 | $ 333.25 | 26 | $ 157.80 | 29 | $ 175.45 | Record sale of inventory | ||||
24-Sep | Cost of Goods Sold (18 x $6.10) | 109.80 | ||||||||
Merchandise Inventory | 109.80 | |||||||||
Record inventory reduction due to sale | ||||||||||
30-Sep | Merchandise Inventory (25 x $6.05) | 151.25 | ||||||||
Cash | 151.25 | |||||||||
weighted average | Purchases | Sales | Ending Inventory | 7-Sep | Merchandise Inventory (10 x $6) | 60.00 | ||||
7-Sep | 10 | $ 6.00 | $ 60.00 | 10 | $ 6.00 | $60 | Cash | 60.00 | ||
Purchased inventory | ||||||||||
15-Sep | 8 | $ 6.00 | $ 48.00 | 2 | $ 6.00 | $ 12.00 | ||||
15-Sep | Cash (8 x $8.50) | 68.00 | ||||||||
20-Sep | 20 | $ 6.10 | $ 122.00 | 2 | $ 6.00 | $ 12.00 | Merchandise Sales Revenue | 68.00 | ||
20 | $ 6.10 | $ 122.00 | per unit | Record sale of inventory | ||||||
22 | $ 134.00 | $6.09 | ||||||||
15-Sep | Cost of Goods Sold (8 X $6) | 48.00 | ||||||||
24-Sep | 18 | $ 6.09 | $ 109.62 | 4 | $ 24.38 | Merchandise Inventory | 48.00 | |||
Record inventory reduction due to sale | ||||||||||
30-Sep | 25 | $ 6.05 | $ 151.25 | 4 | $ - 0 | |||||
25 | $ 6.05 | $ 151.25 | 20-Sep | Merchandise Inventory (20 x $6.10) | 122.00 | |||||
55 | $ 333.25 | 26 | 157.62 | 29 | $ 151.25 | $5.22 | Cash | 122.00 | ||
24-Sep | Cash (18 x 8.50) | 153.00 | ||||||||
Merchandise Sales Revenue | 153.00 | |||||||||
Record sale of inventory | ||||||||||
24-Sep | Cost of Goods Sold (18 x $6.09) | 109.62 | ||||||||
Merchandise Inventory | 109.62 | |||||||||
Record inventory reduction due to sale | ||||||||||
30-Sep | Merchandise Inventory (25 x $6.05) | 151.25 | ||||||||
Cash | 151.25 | |||||||||
date | Cash | date | date | Notes Payable | date | Business License exp | Common Stock | ||
1-Jul | 15,000.00 | 3,000.00 | 7-Jul | 10,000 | 3-Jul | 10-Jul | 375 | 15,000 | 1-Jul |
3-Jul | 10,000.00 | 375.00 | 10-Jul | 5,000 | 13-Jul | ||||
31-Jul | 5,000.00 | 250.00 | 11-Jul | 10,000 | 375 | ||||
8-Aug | 3,200.00 | 200.00 | 13-Jul | 10,000 | 375 | 20,000 | |||
18-Aug | 1,000.00 | 300.00 | 14-Jul | ||||||
31-Aug | 12,500.00 | 1,200.00 | 31-Jul | ||||||
8-Sep | 4,000.00 | 120.00 | 5-Aug | ||||||
15-Sep | 68.00 | 45.00 | 10-Aug | ||||||
24-Sep | 153.00 | 1,500.00 | 15-Aug | ||||||
30-Sep | 6,000.00 | 8,500.00 | 20-Aug | ||||||
480.00 | 20-Aug | ||||||||
300.00 | 22-Aug | ||||||||
3,000.00 | 1-Sep | ||||||||
420.00 | 5-Sep | ||||||||
60.00 | 7-Sep | Accounts Rec. | Insurance expense | ||||||
45.00 | 10-Sep | 31-Jul | 10000 | 3200 | 8-Aug | ||||
5,000.00 | 13-Sep | 31-Aug | 7500 | 1000 | 18-Aug | ||||
1,500.00 | 15-Sep | 30-Sep | 19000 | 4000 | 8-Sep | ||||
456.00 | 20-Sep | ||||||||
122.00 | 20-Sep | COMPLETION OF STEPS 1- 4 DELIVERABLE: | |||||||
151.25 | 30-Sep | CONGRATULATIONS! YOU ARE NOW READY TO SUBMIT YOUR | |||||||
WORKBOOK TO COMPLETE THE 3-3 CHECKPOINT REQUIREMENT | |||||||||
28300 | 0 | ||||||||
56,921.00 | 27,024.25 | ||||||||
29,896.75 | |||||||||
Misc. expense | Baking equipment | Advertising expense | |||||||
11-Jul | 250.00 | 13-Jul | 5,000 | 13-Jul | 200 | ||||
200 | |||||||||
5,000 | |||||||||
250.00 | |||||||||
Baking supplies | Misc. supplies | Rent expense | |||||||
1-Jul | 8,500.00 | 14-Jul | 300 | 15-Aug | 1,500 | ||||
15-Aug | 5,000.00 | 22-Aug | 300 | 15-Sep | 1500 | ||||
11-Sep | 7,000.00 | ||||||||
20,500 | 600 | 0 | |||||||
20,500 | 600 | ||||||||
0 | |||||||||
600 | |||||||||
20500 | |||||||||
Baking supplies | Misc. supplies | Rent expense | |||||||
0 | 0 | ||||||||
- 0 | |||||||||
Prepaid rent | Prepaid insurance | Bakery Sales | |||||||
0 | |||||||||
0 | |||||||||
- 0 | |||||||||
Accounts payable | Salary and wages expense | Salaries and wages payable | |||||||
- 0 | |||||||||
Telephone expense | |||||||||
- 0 | |||||||||
0 | |||||||||
Dividends | depreciation expense | acc dep | |||||||
- 0 | |||||||||
- 0 | |||||||||
0 | 0 | ||||||||
baking supplies expense | Interest expense | Interest payable | |||||||
adj | adj | adj | |||||||
0 | 0 | 0 | |||||||
misc supplies expense | COGS LIF0 | COGS FIFO | |||||||
adj | |||||||||
0 | |||||||||
Merchandise Sales Revenue | - 0 | - 0 | |||||||
- 0 | |||||||||
COGS Weighted Avg. | Merch. Inv. FIFO | Merch. Inv. LIFO | Merch. Inv. Avg. | ||||||
- 0 | - 0 | - 0 | - 0 | ||||||
Peyton Approved | ||||||
Trial Balance | ||||||
2014 | ||||||
Unadjusted trial balance | Adjusting entries | Adjusted trial balance | ||||
Account | Debit | Credit | Debit | Credit | Debit | Credit |
Cash | ||||||
Baking Supplies | ||||||
Merchandise Inventory | ||||||
Prepaid Rent | ||||||
Prepaid Insurance | ||||||
Baking Equipment | ||||||
Misc. Supplies | ||||||
Accounts Receivable | ||||||
Notes Payable | ||||||
Accounts Payable | ||||||
Wages Payable | ||||||
Common Stock | ||||||
Dividends | ||||||
Bakery Sales | ||||||
Merchandise Sales | ||||||
Baking Supplies Expense | ||||||
Rent Expense | ||||||
Insurance Expense | COMPLETION OF STEPS 5-7 DELIVERABLE: | |||||
Misc. Expense | CONGRATULATIONS! YOU ARE NOW READY TO SUBMIT YOUR | |||||
Business License Expense | WORKBOOK TO COMPLETE THE 4-3 CHECKPOINT REQUIREMENT | |||||
Advertising Expense | ||||||
Wages Expense | ||||||
Telephone Expense | ||||||
COGS | ||||||
Depreciation Expense | 208.33 | 208.33 | ||||
Accumulated Depreciation | 208.33 | 208.33 | ||||
Misc Supplies Expense* | ||||||
Interest Expense* | ||||||
Interest Payable* | ||||||
- 0 | - 0 | 208.33 | 208.33 | 208.33 | 208.33 | |
- 0 | ||||||
*These accounts will not be utilized before the adjusting process. They should have zero balance in the unadjusted trial balance. |
Peyton Approved | |||
Adjusting Journal Entries | |||
2014 | |||
Date | Accounts | Debit | Credit |
30-Sep | Depreciation Expense | 208.33 | |
accumulated depreciation | 208.33 | ||
Peyton Approved |
Income Statement |
For Qtr. Ending 9/30/2014 |
Peyton Approved |
Statement of Retained Earnings |
For Qtr. Ending 9/30/2014 |
Peyton Approved | |
Balance Sheet | |
As of September 30, 2014 | |
Assets | Liabilities and Owners' Equity |
Peyton Approved | |||
Closing Entries | |||
9/30/14 | |||
Date | Accounts | Debit | Credit |
Peyton Approved | ||
Post Closing Trial Balance | ||
9/30/14 | ||
Unadjusted Trial Balance | ||
Account | Debit | Credit |
Peyton Approved | |||
Reversing Entries | |||
9/30/14 | |||
Date | Accounts | Debit | Credit |
COMPLETION OF STEPS 8-11 DELIVERABLE: | |||
CONGRATULATIONS! YOU ARE NOW READY TO SUBMIT YOUR | |||
COMPLETED WORKBOOK (STEPS 1 - 11)TO COMPLETE THE 6-2 CHECKPOINT | |||
REQUIREMENT | |||
For this deliverable, you will complete the accounting cycle and prepare financial statements that will provide the result you need to assess the success of business operations.
Below you will find the data required to make entries in your accounting workbook. Remember that you are following the business transactions for a three-month period from the initial stage of analysis and recording, through the reporting process. These transactions will include:
· the initial setup of the business
· cash and credit sales
· making payments to vendors
· paying store employees
· managing debt
It will help you to print this document as you are making your entries in your workbook. Your textbook prepares you and can be used as a reference to assist you in completing this assignment. You should begin this project in Module Two.
ACC 201 Final Project Peyton Approved Instructions
For this deliverable, you will complete the accounting cycle and prepare financial statements that will provide the result you need to assess the success of business operations.
Below you will find the data required to make entries in your accounting work book. Remember that you are following the business transactions for a three-month period from the initial stage of analysis and
recording, through the reporting process. These transactions will include:
? the initial setup of the business
? cash and credit sales
? making payments to vendors
? paying store employees
? managing debt
It will help you to print this document as you are making your entries in your workbook. Your textbook prepare s you and can be used as a reference to assist you in completing this assignment. You should begin
this project in Module Two.
Step 1:
Complete the following in the “July Journal Entries” tab in your workbook (be sure to look for the July Journal Entries tab at the bottom of the Peyton Approved Student Workbook).
The following events occur in July 2014:
July 1 – You take $15,000 from your personal savings account and buy common stock in Peyton
Approved.
July 1-Purchase $8500 in baking supplies from vendor, on account
July 3 – Your parents lend the company $10,000 cash, in exchange for a two-year, 6% note payable. Interest and the principal are repayable at maturity.
July 7 – Pay $3000 toward lease agreement for bakery space. The agreement is for 1 year. The rent is $1,500 per month, last month’s rent was required at time of lease agreement. Lease period is effective July 1st 2014 through June 30th, 2015.
July 10 – Pay $375 to the county for a business license.
July 11 – Purchase a cash register for $250 (deemed to be not material enough to qualify as depreciable equipment—use misc. exp.).
July 13 – You have baking equipment, including an oven and mixer, which you have been using for your home-based business and will now start using in the bakery. You estimate that the equipment is currently worth $5,000, and you transfer the equipment into the business in exchange for additional common stock. The equipment has a 5-year useful life.
July 13 – Pay $200 for business cards/flyers/posters/ads to use for advertising.
July 14 – Pay $300 for miscellaneous (use misc. supplies).
July 15 – Hire part-time helper to be paid $12 per hour. Pay periods are the 1st through the 15th and 16th through the end of the month with paydays being the 20th for the first pay period and the 5th of the following month for the second pay period. (No entry required on this date; for informational purposes only)
July 30- Received telephone bill for July in amount of $45. Payment is due on August 10th
July 31 – Pay $1,200 for a 12-month insurance policy. Policy effective dates August 1, 2014 through July 31st, 2015
July 31- Accrue wages earned for employee for period of 16th through 31st of July
(Wage calculations table is provided for you, below)
Total July bakery sales were $15,000. $5000 of these sales on accounts receivable
Step 1:
Complete the following in the “July Journal Entries” tab in your workbook (be sure to look for the July
Journal Entries tab at the bottom of the Peyton Approved Student Workbook).
The following events occur in July 2014:
July 1 – You take $15,000 from your personal savings account and buy common stock in Peyton
Approved.
July 1-Purchase $8500 in baking supplies from vendor, on account
July 3 – Your parents lend the company $10,000 cash, in exchange for a two-year, 6% note
payable. Interest and the principal are repayable at maturity.
July 7 – Pay $3000 toward lease agreement for bakery space. The agreement is for 1 year . The
rent is $1,500 per month, last month’s rent was required at time of lease agreeme nt. Lease
period is effective July 1
st
2014 through June 30
th
, 2015.
July 10 – Pay $375 to the county for a business license.
July 11 – Purchase a cash register for $250 (deemed to be not material enough to qualify as
depreciable equipment—use misc. exp.).
July 13 – You have baking equipment, including an oven and mixer , which you have been using
for your home-based business and will now start using in the bakery. You estimate that the
equipment is currently worth $5,000, and you transfer the equipment into the business in
exchange for additional common stock. The equipment has a 5 -year useful life.
July 13 – Pay $200 for business cards/flyers/posters/ads to use for advertising.
July 14 – Pay $300 for miscellaneous (use misc. supplies).
July 15 – Hire part-time helper to be paid $12 per hour. Pay periods are the 1
st
through the 15
th
and 16
th
through the end of the month with paydays being the 20
th
for the first pay period and
the 5
th
of the following month for the second pay period. (No entry required on this date; for
informational purposes only )
July 30- Received telephone bill for July in amount of $45. Payment is due on August 10
th
July 31 – Pay $1,200 for a 12-month insurance policy. Policy effective dates August 1, 2014
through July 31
st
, 2015
July 31- Accrue wages earned for employee for period of 16
th
through 31st of July
(Wage calculations table is provided for you, below)
Total July bakery sales were $15,000. $5000 of these sales on accounts receivable
Hours |
Rate |
Pay |
|
31-Jul |
10 |
12 |
120 |
15-Aug |
40 |
12 |
480 |
31-Aug |
35 |
12 |
420 |
15-Sep |
38 |
12 |
456 |
30-Sep |
40 |
12 |
480 |
Wage calculation data:
Month Hours Rate Pay
31-Jul 10 12 120
15-Aug 40 12 480
31-Aug 35 12 420
15-Sep 38 12 456
30-Sep 40 12 480
Step 2:
Complete the following transactions in the August Journal Entries tab in your workbook
August 5- paid employee for period ending 7/31
August 8-Receive payments from customers towards accounts receivable in amount of $3200.
August 10 – paid July telephone bill
August 15- Purchase additional baking supplies in amount of $5000 from vendor, on account.
August 15 – Accrue wages earned for employee from period of 1st through 15th of August
(Wage calculations table provided below)
August 15-Pay rent on bakery space $1500
August 18-Receive payments from customers towards accounts receivable in amount of $1000
August 20- paid $8500 toward baking supplies vendor payable
August 20- pay employee for period ending 8/15
August 22- $300 in misc. supplies purchased
August 31- received telephone bill for August in amount of $45. Payment is due on September 10th.
August 31- Accrue wages earned for employee for period of August 16th through August 31st
(Wage calculations table provided below)
August bakery sales total $20,000. $7,500 of this total on accounts receivable.
Step 2:
Complete the following transactions in the August Journal Entries tab in your workbook
August 5-
paid employee for period ending 7/31
August 8-Receive payments from customers towards accounts receivable in amount of $3200.
August 10 – paid July telephone bill
August 15- Purchase additional baking supplies in amount of $5000 from vendor, on account.
August 15 – Accrue wages earned for employee from period of 1
st
through 15
th
of August
(Wage calculations table provided below )
August 15-Pay rent on bakery space $1500
August 18-Receive payments from customers towards accounts receivable in amount of $1000
August 20- paid $8500 toward baking supplies vendor payable
August 20- pay employee for period ending 8/15
August 22- $300 in misc. supplies purchased
August 31- received telephone bill for August in amount of $45. Payment is due on September
10
th
.
August 31- Accrue wages earned for employee for period of August 16
th
through August 31
st
(Wage calculations table provided below)
August bakery sales total $20,000. $7,500 of this total on accounts receivable.
Step 3:
Many customers have been asking for more hypo-allergenic products, so in September you start carrying a line of hypo-allergenic shampoos on a trial basis. The following information relates to the purchase and sales of the shampoo:
You use the perpetual inventory method. You are uncertain as to which valuation method to use—FIFO, LIFO, or weighted average, so you calculate inventory using all three and then decide which one you would like to choose.
Please see the Inventory Valuation tab in your workbook, to review application of costs using the FIFO, LIFO, and average methods based on purchase and sales information. You will choose the method you feel most appropriate, and bring the journal entries from the inventory valuation page into your journal for the month of September, to ensure the impact of merchandising is reflected in your reporting.
Step 3:
Many customers have been asking for more hypo -allergenic products, so in September you start
carrying a line of hypo-allergenic shampoos on a trial basis. The following information relates to the
purchase and sales of the shampoo:
You use the perpetual inventory method. You are uncertain as to which valuation method to use —FIFO,
LIFO, or weighted average, so you calculate inventory using all three and then decide which one you
would like to choose.
Please see the Inventory Valuation tab in you r workbook, to review application of costs using
the FIFO, LIFO, and average methods based on purchase and sales information. You will choose
the method you feel most appropriate, and bring the journal entries from the inventory
valuation page into your journal for the month of September, to ensure the impact of
merchandising is reflected in your reporting.
Complete the following transactions in the September Journal Entries tab in your workbook.
September 1- paid dividends to self in amount of $3000
September 5-pay employee for period ending 8/31
September 7-Purchase merchandise for resale. See inventory valuation tab for details.
September 8- Receive payments from customers toward accounts receivable in amount of
$4000
September 10- pay August telephone bill
September 11-purchase baking supplies in amount of $ 7,000 from vendor on account.
September 13- Paid on supplies vendor account in amount of $5000
September 15- Accrue employee wages for period of September 1st through September 15th
September 15- Pay rent on bakery space $1500
September 15-Record merchandise sales transaction. See inventory valuation tab for details.
September 15-Record impact of sales transaction on COGS and the inventory asset.
See inventory valuation tab for details.
September 20- Pay employee for period ending 9/15
September 20-Purchase merchandise inventory for resale to customers.
See inventory valuation tab for details.
September 24- Record sales of merchandise to customers.
See inventory valuation tab for details.
September 24- Record impact of sales transaction on COGS and the inventory asset.
See inventory valuation tab for details.
September 30- Purchase merchandise inventory for resale to customers.
See inventory valuation tab for details.
September 30-Accrue employee wages for period of September 16th through September 30th
Total September bakery sales $25,000. $6,000 of these sales on accounts receivable.
Complete the following transactions in the September Journal Entries tab in your workbook.
September 1- paid dividends to self in amount of $3000
September 5-pay employee for period ending 8/31
September 7-Purchase merchandise for resale. See inventory valuation tab for details.
September 8- Receive payments from customers toward accounts receivable in amount of
$4000
September 10- pay August telephone bill
September 11-purchase baking supplies in amount of $ 7,000 from vendor on account.
September 13- Paid on supplies vendor account in amount of $5000
September 15- Accrue employee wages for period of September 1
st
through September 15
th
September 15- Pay rent on bakery space $1500
September 15-Record merchandise sales transaction. See inventory valuation tab for details.
September 15-Record impact of sales transaction on COGS and the inventory asset.
See inventory valuation tab for details.
September 20- Pay employee for period endin g 9/15
September 20-Purchase merchandise inventory for resale to customers.
See inventory valuation tab for details.
September 24- Record sales of merchandise to customers.
See inventory valuation tab for details.
September 24- Record impact of sales transaction on COGS and the inventory asset.
See inventory valuation tab for details.
September 30- Purchase merchandise inventory for resale to customers.
See inventory valuation tab for details.
September 30-Accrue employee wages for period of September 16
th
through September 30
th
Total September bakery sales $25,000. $6,000 of these sales on a ccounts receivable.
Step 4: Post entries to t accounts.
Use the t accounts page in your workbook to post all journal entries to the appropriate ledger account and calculate account balances as of September 30th.
Step 4: Post entries to t accounts.
Use the t accounts page in your workbook to post all journal entries to the appropriate ledger account
and calculate account balances as of September 30
th
.
Step 5: Prepare the Unadjusted Trial Balance
Use the t account balances completed in the previous step to prepare the unadjusted trial balance portion of the Trial Balance tab in your workbook.
On September 30, the following adjustments must be made:
· Accrue interest for note payable (Assume a full month of interest for July).
· Record insurance used for the year.
· Actual baking supplies on-hand as of September 30th is $1100.
· Misc. supplies on-hand as of September 30th is $50.
Apply adjusting entries to the trial balance to create the adjusted trial balance.
Step 5: Prepare the Unadjusted Trial Balance
Use the t account balances completed in the previous step to prepare the unadjusted trial balance
portion of the Trial Balance tab in your workbook.
You will use the “Adjusting Entries” tab in your workbook to complete the following entries. See
sample for Depreciation of Baking Equipment.
On September 30, the following adjustments must be made:
? Depreciation of baking equipment transferred to company on 7/13. Assume ½ month of
depreciation in July using the straight-line method.
? Accrue interest for note payable (Assume a full month of interest for July).
? Record insurance used for the year.
? Actual baking supplies on-hand as of September 30
? Misc. supplies on-hand as of September 30th is $50.
Apply adjusting entries to the trial balance to create the adjusted trial balance.
On September 30, the following adjustments must be made:
· Record insurance used for the year.
· Actual baking supplies on-hand as of September 30th is $1100.
· Misc. supplies on-hand as of September 30th is $50.
You will use the “Adjusting Entries” tab in your workbook to complete the following entries. See
sample for Depreciation of Baking Equipment. Take the adjusting entries from this works heet and
enter them into the trial balance on the Steps 5 and 7 Trial Balance tab.
On September 30, the following adjustments must be made:
? Depreciation of baking equipment transferred to company on 7/13. Assume ½ month of
depreciation in July using the straight -line method.
? Record insurance used for the year.
? Actual baking supplies on-hand as of September 30
? Misc. supplies on-hand as of September 30th is $50.
Prepare the financial statements
Prepare the financial statements
Use your adjusted trial balance to prepare the income statement, statement of owner’s equity, and
balance sheet. You must complete these statements in this order, as there are interdependencies
Prepare the financial statements
Prepare the financial statements
You will use the “Closing Entries” tab in your workbook to do the following:
Close all temporary income statement accounts and create closing entries.
You will use the “Closing Entries” tab in your workbook to do the following:
Close all temporary income statement accounts and create closing entries.
You will use the Post Closing Trial Balance tab in your workbook to do the following:
Prepare the post-closing trial balance for the next accounting period.
You will use the Post Closing Trial Balance tab in your workbook to do the following:
Prepare the post-closing trial balance for the next accounting period.
You will use the “Reversing Entries” tab in your workbook to do the following:
You will use the “Reversing Entries” tab in your workbook to do the following: