The prices given are Service Price per hour provided: $96.00 Sales Price per unit of inventory sold:
The prices given are
Service Price per hour provided: $96.00
Sales Price per unit of inventory sold: $84.00
Cost per unit of inventory sold: $38.75 Your company began operations on December 1. You will be required to complete the accounting cycle for your company in December and prepare financial statements as you have chosen December 31 as your corporation's fiscal year-end. You will receive unique prices for your transactions in an email sent directly to you (so check your WSU email later today) The project will not be the same for all students. Remember the financial statements are linked so make sure you end up with assets = liabilities + Stockholders' Equity on your Balance Sheet Financial Statement when you are done! Part 1 – Create a hypothetical service/merchandising company. It must include sales of merchandise along with revenue from performing services. You will determine your company name, services to be provided and the product to be sold. You will be assigned prices. You will include the following on the first page of the project (see template) Corporate name of your choice Service provided and service price Product sold, sales price, and cost of product (Your unique assigned revenue per service hour and per unit of product sold along with the cost of goods sold per unit of product sold is emailed to you) Brief Description of Mission Statement and Corporation's Operations We were unable to transcribe this image230 Course Project Pay employee salaries, $4,000. Dec. 31 16 Pay cash dividends to shareholders, $1,000. Dec. 31 17 Vehicle did not meet expectations sold back to dealership for $38,000. (Record depreciation at date of sale and then record sale) 18 Dec. 31 Part 3-General Ledger (LO3-2) – Post the information from the journal entries into the general ledger an calculate balances Part 4 Trial Balance (LO3-2) Prepare a trial bala nce from the information in the general ledger. Part 5-Adjusting journal Entries – (LO3-3) – Post the following adjusting entries to the general journal Record the portion of the Prepaid Rent used in December Dec. 31 Adj-1 Dec. 31 The company has $400 of supplies left at month end. Adj-2 Record one month of depreciation for the equipment purchased on December 1st. The equipment has a useful life of 5 years and a $4,000 Adj-3 Dec. 31 residual value. Provide 10 hours of services that were paid in advance on December Adj-4 Dec. 31 23rd Record the receipt of a December $300 utility bill to be paid on January 5th Adj-5 Dec. 31 Record accrued interest on the $30,000 -1 year note payable. The annual interest rate is 6%. Interest is paid on note maturity. Adj-6 Dec. 31 Employees earned $1,000 the last week in December that will be paid on January 10th of next year. Adj-7 Dec. 31 Estimate that 3% of the accounts receivable at the end of the year will Adj-8 Dec. 31 not be collected and record bad debt adjustment. Adj-9 Record Income Tax at a 21% rate to be paid next year. Dec. 31 230 Course Project General Ledger – Post the adjusting entries to the General Ledger. Part 6 Part 7 – Adjusted Trial Balance (LO3-3) – Post the ending balances in each account from the General Ledger to the Adjusted Trial Balance. Debits should equal credits if you have done the prior steps correctly. Part 8- Prepare the end of the year Income Statement (LO3-4) Part 9 Prepare the end of the year Retained Earnings Statement (LO3-4) Part 10 Prepare the end of the year Balance Sheet (LO3-4) Service Provided & Cost of Service: Service Price per hour provided: $96.00 Retail Product Sold & Sale Price and Cost of Product Sold: Sales Price per Unit Sold: $ 84.00 Cost per Unit Sold: $38.75 Part 2- General Journal (LO3-2) – Record the external journal entries to the general journal. General Journal Transaction Account Name Debit Credit Date 1 Dec 1 2 Dec 1 3 Dec 1 Dec 1 4 5 Dec 1 6 Dec 3 7 Dec 3 8 Dec 6 Dec 10 9 Dec 12 10 11 Dec 15 Part 2- Continued… 12 Dec 20 13 Dec 23 14 Dec 31 15 Dec 25 16 Dec 31 17 Dec 31 18 Dec. 31 Dec. 31 GENERAL LEDGER Part 3 -Post External Entries and Ending balances to general ledger Cash Accounts Receivable Equipment Inventory тВ Vehicle тВ тв Allowance for Uncollectible TB Accumulated Depreciation Accounts Supplies ATB Notes Receivable TB тВ TB тВ ATB ATB Accounts Payable Pre-Paid Rent Deferred Revenue тВ ТВ Notes Payable TB ATB ATB Interest Payable TB Utilities Payable Salaries Payable ATB Income Tax Payable ATB ATB ATB Salary Expense Services Revenue Sales Revenue Sales Discount тВ TB TB TB Utilities Payable ATB ATB ATB TB Depreciation Expense Cost of Goods Sold Supplies Expense Interest Expense TB ATB ATB Utility Expense Bad Debt Expense ATB ATB ATB Retained Earnings Common Stock Rent Expense TB 0 Loss on Sale ATB TB Dividends Income Tax Expense TB ATB ТВ TB Trial Balance (should be your balance in the account after posting the external transactions) ATB= Adjusted Trial Balance (should be your balance in the account after posting the adjusting journal fransactions) If there was not an adjusting entry for an account, then the TB ending balance for that account would be the amount posted in both the Trial Balance and the Adjusted Trial Balance. Sample of posting to account: External journal: Purchased $500 of supplies. Adjusting journal: $300 of supplies left at the end of the year so used up $200 of supplies. $500 in Trial Balance $300 in Adjusted Trial Balance; Equipment purchased for $60,000 $60,000 in Trial Balance $60,000 in Adjusted Trial Balance Darkened cells – no data entry Supplies тв 500 Equipment 200 ATB 300 TB 60,000 Part 4-Trial Balance (LO3-2)- Prepare a trial balance from the information in the general ledger. Some accounts will not have postings until after adjusting entries have been recorded Trial Balance December 31, 2019 Credit Account Debit Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Supplies Pre-Paid Rent Note Receivable Equipment Vehicle Accumulated Depreciation Accounts Payable Notes Payable Deferred (Unearned Revenue) Salaries Payable Interest Payable Common Stock Dividends Retained Earnings (Beginning) Service Revenue Sales Revenue Sales Disc Salaries Expense Supplies Expense Cost of Goods Sold Depreciation Expense Loss on Sale Bad Debt Expense Interest Expense Total Part 5- Adjusting journal Entries – (LO3-3) Record the adjusting entries to the general journal Adj-1 Dec. 31 Adj-2 Dec. 31 Adj-3 Dec. 31 Adj-4 Dec. 31 Adj-5 Dec. 31 Adj-6 Dec. 31 Adj-7 Dec. 31 Adj-8 Dec. 31 Adj-9 Dec. 31 Part 6- GENERAL LEDGER Post Adjusting Journal Entries and Ending balances to the general ledger accounts Part 7 -Adjusted Trial Balance (LO3-3) – Post the ending balances from the General Ledger to the Adjusted Trial Balance. Debits should equal credits if you have done the prior steps correctly Adjusted Trial Balance December 31,2019 Debit Credit Account Cash Accounts Receivable Allowance for Uncollectible Accounts Inventory Supplies Pre-Paid Rent Note Receivable Equipment Vehicle Accumulated Depreciation Accounts Payable Notes Payable Deferred (Unearned Revenue) Salaries Payable Utilities Payable Interest Payable Income Tax Payable Common Stock Dividends Retained Earnings (Beginning) Service Revenue Sales Revenue Sales Disc Salaries Expense Supplies Expense Cost of Goods Sold Depreciation Expense Rent Expense Utility Expense Bad Debt Expense Income Tax Expense Interest Expense Loss on Sale Total Part 8- Prepare the end of the year Multi-Step Income Statement (LO3-4) Multi-Step Income Statement For the Year Ended December 31, 2019 Revenue Total Revenue Less Gross Profit Expenses: Salaries Expense Supplies Expense Depreciation Expense Rent Expense Utility Expense Bad Debt Expense $ Total Operating Expenses Operating Income Income Before Income Taxes Income Tax Expense 21% rate round to nearest whole dollar Net Income Part 9- Prepare the end of the year Statement of Stockholders' Equity (LO3-4). Statement of Stockholders' Equity For the year ended Dec. 31, 2019 Total Stockholder's Common Stock Retained Earnings Equity Beginning Balances $ Issued Stock Net Income Dividends Ending Balances S S Part 10 Prepare the end of year Balance Sheet (LO3-4) Balance Sheet December 31, 2019 Liabilities Assets Current Liabilities Current Assets: S Less Total Current Assets $ Total Current Liabilities $ Long-Term Liabilities Long-Term Assets: 0 Total Liabilities Stockholders' Equity: Less Common Stock Total Long-Term Assets Retained Earnings Total Stockholders' Equity $ Total Liabilities and $ Total Assets Stockholders' Equity
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