Business & Finance

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. 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

Step 1 July Journal

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

Step 2 August Journal

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

Step 3 September Journal

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

Inventory Valuation

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

Step 4 T accounts

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

Steps 5 and 7 Trial Balance

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.

Step 6 Adjusting Entries

Peyton Approved
Adjusting Journal Entries
2014
Date Accounts Debit Credit
30-Sep Depreciation Expense 208.33
accumulated depreciation 208.33

Step 8 Income Statement

Peyton Approved
Income Statement
For Qtr. Ending 9/30/2014

Step 8 Statement of Retained Ea

Peyton Approved
Statement of Retained Earnings
For Qtr. Ending 9/30/2014

Step 8 Balance Sheet

Peyton Approved
Balance Sheet
As of September 30, 2014
Assets Liabilities and Owners’ Equity

Step 9 Closing Entries

Peyton Approved
Closing Entries
9/30/14
Date Accounts Debit Credit

Step 10 Post Closing Trial Bala

Peyton Approved
Post Closing Trial Balance
9/30/14
Unadjusted Trial Balance
Account Debit Credit

Step 11 Reversing Entries

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

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 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

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

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—FIFOLIFO, 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.

Step 6:

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 30th is $1100.

· Misc. supplies on-hand as of September 30th is $50.

Step 7:

Apply adjusting entries to the trial balance to create the adjusted trial balance.

Adjusting entries from Step 6 will apply to affected accounts in the unadjusted trial balance to arrive at 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.

Step 6:

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

th

is $1100.

 Misc. supplies on-hand as of September 30th is $50.

Step 7:

Apply adjusting entries to the trial balance to create the adjusted trial balance.

Adjusting entries from Step 6 will apply to affected accounts in the unadjusted trial balance to arrive at

the adjusted trial balance.

Step 6:

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 worksheet 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.

· Accrue interest for note payable. Assume a full month of interest for July. (6% annual interest on $10,000 loan from parents.

· 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.

Step 6:

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.

 Accrue interest for note payable. Assume a full month of interest for July . (6% annual interest on

$10,000 loan from parents.

 Record insurance used for the year.

 Actual baking supplies on-hand as of September 30

th

is $1100.

 Misc. supplies on-hand as of September 30th is $50.

Step 8:

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 among them.

Step 8:

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

among them.

Step 8:

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 among them.

Step 8:

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 among them.

Step 9:

You will use the “Closing Entries” tab in your workbook to do the following:

Close all temporary income statement accounts and create closing entries.

Step 9:

You will use the “Closing Entries” tab in your workbook to do the following:

Close all temporary income statement accounts and create closing entries.

Step 10

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.

Step 10

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.

Step 11”

You will use the “Reversing Entries” tab in your workbook to do the following:

Prepare reversing entries.

Step 11”

You will use the “Reversing Entries” tab in your workbook to do the following:

Prepare reversing entries.

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