accounting project

Accounting Project – ACCT 1010
Name:__________________________
Purpose: The purpose of this assignment is to help you learn how the accounting
cycle works in all businesses. The accounting cycle is the process of assembling
accounting information for use by decision makers for businesses in every
accounting period. If you understand how the accounting cycle works, you will be
more effective in making decisions to advance any business you manage or own.
If you master the accounting cycle as presented in this project now, the remainder
of accounting principles will be much easier to master.
Skills: This assignment will help you practice the following skills that are
important for your success in school and work:
• Analyze business transactions.
• Record transactions in a journal and post entries to a ledger.
• Prepare a trial balance.
• Prepare adjusting entries.
• Prepare an adjusted trial balance.
• Prepare basic financial statements from an adjusted trial balance.
• Prepare closing entries.
• Prepare a post-closing trial balance.
Knowledge: This assignment will also help you:
• Identify, record, and communicate any organization’s business
activities.
• Interpret financial statements.
• Become an effective business decision maker.
Task: To complete this assignment, follow these steps:
The Accounting Cycle Project is to be completed by hand using hard
copy working papers. (Print the project to begin) The purpose of this
requirement is that students generally have a greater comprehension of the
complete accounting cycle by processing the steps by hand.
Preparation:
Complete the required steps for the project preparing your work in pencil using
the hard copy working papers included in this packet. Your work should be
neat and legible. You may omit explanations when recording journal entries.
Refer to page 141 in your textbook for an example of how to format the
financial statements.
Submitting Your Project:
Submit the hand-prepared project by Due Date: November 5, 2024.
Page 1 of 15
Grade Impact & Academic Integrity:
This homework project will be worth 5% of your overall course grade.
Submitting work copied from another source is a violation of the Academic
Dishonesty Policy and will result in a grade of -0- for the project.
Video Help and Practice:
There are six Connect videos available to you to review how to complete the
following requirements. They are not required or graded as part of the project but
will remind you how to complete the requirements of the project listed below.
Requirements:
1. Journalize the December transactions for Business Solutions. You may
omit explanations for the journal entries. Skip a line between each journal
entry – see the journal entries in textbook chapter 2 as a formatting
example (complete on page 4).
2. Continue with the ending November balances that are already in the
ledger. Post the December transactions to the appropriate accounts in the
modified ledger and update balances (complete on pages 6 – 8).
3. Prepare a trial balance to prove the equality of debits and credits prior to
continuing with this project. Omit any accounts that have a zero balance
(complete on page 9). Check figure: $106,884. Consult your instructor
if your trial balance does not balance before proceeding with the
project.
4. Journalize the adjusting entries to reflect items a through f above
(complete on page 5).
5. Post the adjusting entries to the appropriate accounts in the ledger
(complete on pages 6 – 8).
6. Prepare an adjusted trial balance as of December 31, 202X (complete on
page10). Check figure: $109,034. Consult your instructor if your
adjusted trial balance does not balance before proceeding with
the project.
7. Prepare the three basic financial statements in good form. See page 141
of your accounting text for a good example of financial statement
formatting.
a. Prepare an income statement for the three months ended December
31, 202X (complete on page 11).
b. Prepare a statement of owner’s equity for the three months ended
December 31, 202X (complete on page 11). The 73,000 balance in
the capital account was an investment on October 3.
c. Prepare a balance sheet as of December 31, 202X (complete on
page 12).
8. Journalize and post the necessary closing entries for Parker Consulting
(complete on page 5 – 8).
9. Prepare a post-closing trial balance as of December 31, 202X (complete
on page 13).
Page 2 of 15
Project Data:
Sam Parker owns and operates a consulting firm called Business Solutions. The business
began operating in October 202X. Transactions for October and November 202X have been
recorded and posted.
Business Solutions had the following transactions in December 202X.
Dec
2 Paid $1,025 cash to Hillside Mall for Business Solutions’s share of mall advertising
costs.
3 Paid $500 cash for minor repairs to the company’s computer.
4 Received $3,950 cash from Alex’s Engineering Company for the receivable from
November.
10 Paid cash to Lyn Addie for six days of work at the rate of $125 per day.
14 Notified by Alex’s Engineering Company that Business Solutions’s bid of $7,000 on a
proposed project has been accepted. Alex’s paid a $1,500 cash advance to Business
Solutions.
15 Purchased $1,100 of computer supplies on credit from Harris Office Products.
20 Completed a project for Liu Corporation and received $5,625 cash.
28 Received $3,000 cash from Gomez Company on its receivable.
29 Reimbursed S. Rey for business automobile mileage (600 miles at $0.32 per mile).
31 S. Parker withdrew $1,500 cash from the company for personal use.
The following additional facts are collected for use in making adjusting entries prior to
preparing financial statements for the company’s first three months of operations:
a. The December 31 inventory count of computer supplies shows $580 still available.
b. Three months have expired since the 12-month insurance premium was paid in
advance.
c. As of December 31, Lyn Addie has not been paid for four days of work at $125 per day.
d. The computer system, acquired on October 1, is expected to have a four-year life with
no salvage value.
e. The office equipment, acquired on October 1, is expected to have a five-year life with no
salvage value.
f. Three of the four months’ prepaid rent have expired.
Page 3 of 15
Homework Project 1 –
Working Papers
Name:_______
____________
General Journal for Requirements 1, 4 & 8
GENERAL JOURNAL
DATE
202X
Dec
ACCOUNT
December Transactions (20 points)
Page 4 of 15
POST
REF
DEBIT
CREDIT
GENERAL JOURNAL
DATE
202X
Dec
ACCOUNT
Adjusting Entries (17 points)
Closing Entries (10 points)
Page 5 of 15
POST
REF
DEBIT
CREDIT
Ledger for Requirements 2, 5, & 10
Note: Ledger includes the balance of each account as of November 30 for Business Solutions.
Continue by posting all the December transactions.
101: Cash
Date
Debit
Credit
Nov 30
106: Accounts Receivable
Balance
38,264
Date
Debit
Credit
Nov 30
Debit
Credit
Nov 30
Balance
Date
2,545
Nov 30
Debit
Credit
12,618
Debit
Credit
Balance
2,220
163: Office Equipment
Balance
Date
3,300
Nov 30
164: Accum Dep Office Equipment
Date
Balance
128: Prepaid Insurance
131: Prepaid Rent
Date
Credit
Nov 30
126: Computer Supplies
Date
Debit
Debit
Credit
Balance
8,000
167: Computer Equipment
Balance
Date
Nov 30
Page 6 of 15
Debit
Credit
Balance
20,000
Ledger (Continued)
168: Accum Dep Computer Equipment
Date
Debit
Credit
Balance
210: Wages Payable
Date
Debit
Credit
201: Accounts Payable
Date
Debit
Credit
Nov 30
Balance
Date
Debit
Credit
Nov. 30
Balance
Date
73,000
Nov. 30
Date
Debit
Credit
Balance
Debit
Credit
Balance
5,600
612: Dep. Expense – Office Equipment
Balance
Date
Debit
Credit
Balance
25,659
613: Dep. Expense-Computer Equipment
Date
Balance
302: S. Parker, Withdrawals
403: Computer Service Revenue
Date
Credit
236: Unearned Compter Services Revenue
301: S. Parker, Capital
Date
Debit
Debit
Credit
Balance
623: Wages Expense
Date
Nov. 30
637: Insurance Expenses
Debit
Credit
Balance
Page 7 of 15
Date
Debit
Credit
640: Rent Expense
Debit
Credit
Balance
2,625
Balance
Ledger (Continued)
652: Computer Supplies Expense
Date
Date
Nov. 30
Debit
Credit
655: Advertising Expense
Balance
676: Mileage Expenses
Debit
Credit
Balance
704
Date
Nov 30
Debit
Credit
Balance
677: Miscellaneous Expense
Date
Nov. 30
Debit
Credit
Credit
Balance
1,728
684: Repairs Expense—Computer
Date
Debit
Credit
Balance
Oct. 17
805
805
901: Income Summary
Date
Debit
Balance
250
Page 8 of 15
Working Paper for Requirement 3
3 points
Business Solutions
Trial Balance
December 31, 202X
DEBIT
Page 9 of 15
CREDIT
Working Paper for Requirement 6
3 points
Business Solutions
Adjusted Trial Balance
December 31, 202X
DEBIT
Page 10 of 15
CREDIT
Working Papers for Requirements 7, 8 & 9
Business Solutions
Income Statement (10 points)
For Three Months Ended December 31, 202X
Business Solutions
Statement of Owner’s Equity (5 points)
For Three Months Ended December 31, 202X
Page 11 of 15
Working Papers for Requirements 6, 7 & 8 (continued)
Business Solutions
Balance Sheet (10 points)
December 31, 202X
Page 12 of 15
Working Papers for Requirement 10
Business Solutions
Post-Closing Trial Balance
December 31, 202X
DEBIT
Page 13 of 15
CREDIT
Criteria for Success:
Grading Criteria:
This project will be graded on a 100-point scale based on completeness, accuracy, and
neatness as shown in the grading details below.
Grading Details:
Item
Journal Entries
Adjusting Entries
Closing Entries
Ledger Acct Balances
Unadjusted Trial Balance
Adjusted Trial Balance
Income Statement
Statement of Owner’s Equity
Balance Sheet
Post-Closing Trial Balance
Neatness and format
Total Possible Points
Points
20 points (1 point for each correct account)
17 points (1 point for each correct account; 1 point for each
correct amount calculation)
10 points (2 points for each entry; 2 points for correct amounts)
12 points (1/2 point for each correct balance)
3 points for preparation
3 points for preparation
10 points
5 points
10 points
3 points for preparation
7 points
100
Page 14 of 15
Business Solutions – Chart of Accounts (You can separate this page from the project to
use as reference for choosing account titles for journal entries)
101: Cash
106: Accounts Receivable
126: Computer Supplies
128: Prepaid Insurance
131: Prepaid rent
163: Office equipment
164: Accum Dep Office Equipment
167: Computer Equipment
168: Accum Dep Computer Equipment
201: Accounts Payable
210: Wages Payable
236: Unearned computer services revenue
301: S. Parker, Capital
302: S. Parker, Withdrawals
403: Computer service revenue
612: Dep. expense – Office equipment
613: Dep. Expense – Computer equipment
623: Wages expense
637: Insurance expense
640: Rent expense
652: Computer supplies expense
655: Advertising Expense
676: Mileage expense
677: Miscellaneous expenses
684: Repairs expense – Computer
901: Income Summary
Page 15 of 15