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7-2 Project: Company Accounting Workbook And Summary Report ACC-201 Competencies In this project, you will demonstrate your mastery of the following compet

7-2 Project: Company Accounting Workbook And Summary Report ACC-201 Competencies
In this project, you will demonstrate your mastery of the following compet

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7-2 Project: Company Accounting Workbook And Summary Report ACC-201 Competencies
In this project, you will demonstrate your mastery of the following competencies:

Record and present financial information by applying the appropriate framework and guidelines of accounting for business transactions
Determine asset accounts and their disclosure in the financial statements
Determine liability and equity accounts and their disclosure in the financial statements

Scenario
You are a certified public accountant (CPA) who is working with a small bakery to prepare their financial statements for three months of the current fiscal year. Because the company is a startup and so small, the accounting is done manually in Microsoft Excel. You have been given the accounts and information you need to prepare their financial statements, but you will need to use the accounting cycle to report accurate information to the finance department. The business owners have also asked you to summarize the company’s performance based on the financial statements.
Directions
Company Accounting Workbook
Use accepted accounting principles to follow and record your business transactions for a three-month period from the first step of the accounting cycle through the reporting process. You will build on your work from Milestones One and Two to complete your workbook using the Company Accounting Workbook Template (linked in the What to Submit section).
Your completed accounting workbook will consist of journal entries for each transaction and postings of transactions to account ledgers. You will develop a trial balance from ledger balances and adjust revenue and expense accounts, as necessary, to ensure that revenues and expenses are reported in the appropriate period under the accrual accounting method. The adjusted trial balance will be used to prepare the income statement, the statement of owner’s equity, and the balance sheet. After the preparation of the financial statements, closing entries will be entered to transfer earnings to equity and prepare temporary accounts for the new accounting period.
Use the instructions below to complete your workbook.

Record Financial Data: Use accepted accounting principles to accurately capture business transactions for October, November, and December using the data provided in the accounting data appendix (linked in the Supporting Materials section). You will need to address the following:

Accuracy: Prepare entries that are accurate in that they fully reflect the appropriate information.
Completeness: Prepare entries that are complete for each month, including transferring posted entries to T accounts.
Inventory Valuation: Prepare entries for the month of December to reflect the new line of products offered by the company, which includes using the data from the “Inventory Valuation” tab of the company accounting workbook.

Accrual Basis: Apply the accrual basis of accounting and prepare adjusting entries to ensure accurate accounting for expenses that lack transactions in the current period.

Unadjusted Trial Balance: Prepare the unadjusted trial balance portion of the “Trial Balance” tab of the company accounting workbook, ensuring that the total debits and credits match.
Adjusting Entries: Prepare the “Adjusting Entries” tab of the company accounting workbook.
Adjusted Trial Balance: Prepare the adjusted trial balance on the “Trial Balance” tab, ensuring that the debit and credit totals match.

Financial Statements: Create financial statements using appropriate methods based on accepted accounting principles. Be sure to prepare these financial statements in the order listed, as there are important interdependencies among them.

Income Statement: Prepare the income statement using the adjusted trial balance.
Statement of Owner’s Equity: Prepare the statement of owner’s equity using the adjusted trial balance.
Balance Sheet: Prepare the balance sheet using the adjusted trial balance.
Closing Entries: Complete the “Closing Entries” tab of the company accounting workbook by closing all temporary income statement amounts to create closing entries.
Post-Closing Trial Balance: Prepare the “Post-Closing Trial Balance” tab of the company accounting workbook in preparation for the next accounting period.

Summary Report
After you have completed preparing all the financial statements, analyze the statements and write a short report summarizing your findings. Use the template provided in the What to Submit section to complete your report.

Summary: Write a summary of what the financial statements indicate about the company’s financial health and performance.

Purpose: What kind of information would these financial statements provide to various aspects of the business?
Analysis: What is the company’s cash position, its net income as a percentage of sales, and its current liabilities to current assets position?

What to Submit
To complete this project, you must submit the following:
Company Accounting Workbook Spreadsheet
Your workbook should be completed and submitted as a Microsoft Excel file based on the template provided.
Project Summary Report Word Document
Use this template to submit a 1- to 2-page Word document summarizing the financial statements you created.
Supporting Materials
The following resources support your work on the project:
Resource: Accounting Data Appendix Word Document
This resource includes all of the existing financial information needed to complete your project.
Tutorial: Infobase Microsoft Excel Tutorial
This tutorial from Infobase provides helpful information on how to use the basic features of Microsoft Excel. Use the table of contents to select the tutorials that best suit your needs. Chart of 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.

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 Cost of Goods Sold 303

Prepaid Insurance 104 Interest Payable 204

Baking Equipment 105

Office Supplies 106

Accounts Receivable 107

Accumulated Depreciation 108

Merchandise Inventory 109 Revenue Accounts

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

Office Supplies Expense 511

Cash

Baking Supplies

Prepaid Rent

Prepaid Insurance

Baking Equipment

Office Supplies

Accounts Receivable

Accumulated Depreciation

Merchandise Inventory

Notes Payable

Accounts Payable

Wages Payable

Interest Payable

Common Stock

Dividends

Bakery Sales

Merchandise Sales

Baking Supplies Expense

Rent Expense

Insurance Expense

Misc. Expense

Business License Expense

Advertising Expense

Wages Expense

Telephone Expense

Interest Expense

Depreciation Expense

Office Supplies Expense

Cost of Goods Sold

October Journal Entries

A Company

General Journal Entries

October, 20xx

Date Accounts Debit Credit

1-Oct $

$

1-Oct

3-Oct

7-Oct

10-Oct

11-Oct

13-Oct

13-Oct

14-Oct

30-Oct

31-Oct

31-Oct

31-Oct

Total – 0 – 0

November Journal Entries

A Company

General Journal Entries

November, 20xx

Date Accounts Debit Credit

Total – 0 – 0

December Journal Entries

A Company

General Journal Entries

December, 20xx

Date Accounts Debit Credit

Total – 0 – 0

T-Accounts – autofill

date Cash date date Notes Payable date Business License exp Common Stock

1-Oct $ – 0 3-Oct 10-Oct – 0 $ 1-Oct

3-Oct – 0 0 13-Oct

– 0 7-Oct

– 0 10-Oct 0

– 0 11-Oct

– 0 13-Oct

– 0 14-Oct

– 0 31-Oct

31-Oct – 0

– 0 5-Nov

8-Nov – 0

– 0 10-Nov

18-Nov – 0

– 0 15-Nov

– 0 20-Nov Accounts Rec. Insurance expense

– 0 20-Nov 31-Oct – 0

– 0 22-Nov – 0 8-Nov

30-Nov – 0 – 0 18-Nov

– 0 1-Dec 30-Nov – 0

– 0 5-Dec – 0 8-Dec

– 0 7-Dec 31-Dec – 0

8-Dec – 0

– 0 10-Dec 0 0

– 0 13-Dec 0

– 0 15-Dec

15-Dec – 0

– 0 20-Dec

– 0 20-Dec

24-Dec – 0

– 0 30-Dec

31-Dec – 0

– 0 – 0

– 0

Misc. expense Baking equipment Advertising expense

11-Oct – 0 13-Oct – 0 13-Oct – 0

Baking supplies Office supplies Rent expense

1-Oct – 0 14-Oct – 0 7-Oct – 0

15-Nov – 0 22-Nov – 0 15-Nov – 0

11-Dec – 0 15-Dec – 0

– 0 – 0

– 0

Prepaid rent Prepaid insurance Bakery Sales

7-Oct – 0 31-Oct – 0 – 0 31-Oct

– 0 30-Nov

– 0 31-Dec

– 0

Accounts payable Salary and wages expense Salaries and wages payable

– 0 1-Oct 31-Oct – 0 – 0 31-Oct

– 0 31-Oct 15-Nov – 0 5-Nov – 0

10-Nov – 0 30-Nov – 0 – 0 15-Nov

– 0 15-Nov 15-Dec – 0 20-Nov – 0

20-Nov – 0 31-Dec – 0 – 0 30-Nov

– 0 30-Nov 5-Dec – 0

10-Dec – 0 – 0 – 0 15-Dec

– 0 11-Dec 20-Dec – 0

13-Dec – 0 – 0 31-Dec

– 0 – 0

– 0

Telephone expense

30-Oct – 0 – 0 – 0

30-Nov – 0 – 0

– 0 Dividends

1-Dec – 0

– 0

COGS

15-Dec – 0

24-Dec – 0

– 0

Merchandise Sales Revenue

– 0 15-Dec

– 0 24-Dec

– 0

Merch. Inv. FIFO

7-Dec – 0

– 0 15-Dec

20-Dec – 0

– 0 24-Dec

30-Dec – 0

– 0 – 0

– 0

Inventory Valuation

FIFO

Purchases Sales Ending Inventory Purchases

Date No. of Items Unit Price Total Price No. of Items Unit Price Total Price No. of Items Unit Price Total Price Date Dr Cr 12/7: 10 boxes purchased at $6

7-Dec 10 $ 6.00 $ 60.00 10 $ 6.00 $ 60.00 7-Dec Merchandise Inventory (10 x $6) 60.00 12/20: 20 boxes purchased at $6.10

Cash 60.00 12/30: 25 boxes purchased at $6.05

15-Dec 8 $ 6.00 $ 48.00 2 $ 6.00 $ 12.00 Purchased inventory Sales – selling price, $8.50 a box

12/15: 8 boxes

20-Dec 20 $ 6.10 $ 122.00 2 $ 6.00 $ 12.00 15-Dec Cash (8 x $8.50) 68.00 12/24: 18 boxes

20 $ 6.10 $ 122.00 Merchandise Sales Revenue 68.00

22 $ 134.00 Record sale of inventory

24-Dec 2 $ 6.00 $ 12.00 15-Dec Cost of Goods Sold (8 X $6) 48.00

16 $ 6.10 $ 97.60 4 $ 6.10 $ 24.40 Merchandise Inventory 48.00

18 $ 109.60 Recorded the cost of goods sold

30-Dec 25 $ 6.05 $ 151.25 4 $ 6.10 $ 24.40 20-Dec Merchandise Inventory (20 x $6.10 ) 122.00

25 $ 6.05 $ 151.25 Cash 122.00

29 $ 175.65

Net Inventory 55 $ 333.25 26 $ 157.60 29 $ 175.65 24-Dec Cash (18 x 8.50) 153.00

Merchandise Sales Revenue 153.00

Record sale of inventory

24-Dec Cost of Goods Sold (2 x $6)+(16 x $6.10) 109.60

Merchandise Inventory 109.60

Recorded the cost of goods sold

30-Dec Merchandise Inventory (25 x $6.05) 151.25

Cash 151.25

Trial Balance

A Company

Trial Balance

20xx

Unadjusted trial balance Adjusting entries Adjusted trial balance

Account Debit Credit Debit Credit Debit Credit

Cash – 0

Baking Supplies – 0

Merchandise Inventory

Prepaid Rent

Prepaid Insurance – 0

Baking Equipment

Accumulated Depreciation – 0

Office Supplies – 0

Accounts Receivable

Notes Payable

Interest Payable – 0

Accounts Payable

Wages Payable

Common Stock

Dividends

Bakery Sales

Merchandise Sales

Baking Supplies Expense – 0

Rent Expense

Interest Expense – 0

Insurance Expense – 0

Depreciation Expense – 0

Misc. Expense

Office Supplies Expense – 0

Business License Expense

Advertising Expense

Wages Expense

Telephone Expense

COGS

Total: – 0 – 0 – 0 – 0 – 0 – 0

Adjusting Entries

A Company

Adjusting Journal Entries

20XX

Date Accounts Debit Credit

31-Dec Depreciation Expense

Accumulated Depreciation

– 0 – 0

Income Statement

A Company

Income Statement

For Qtr. Ending 12/31/20XX

Revenues

Total Revenues – 0

Gross Profit – 0

Operating Expenses:

– 0

Total Operating Expenses: – 0

Net Income – 0

Statement of Stockholder Equity

A Company

Statement of Stockholder’s Equity

For Qtr. Ending 12/31/20xx

Common Stock Retained Earnings Total

Beginning Balances, September 30 0 0 0

Issued Common Stock

Net Income

Dividends

Ending Balances, December 31: – 0 – 0 – 0

Balance Sheet

A Company

Balance Sheet

As of December 31, 20XX

Assets Liabilities and Owners’ Equity

Current Assets: Current Liabilities:

Total Current Liabilities – 0

Long Term Liabilities:

Total Current Assets – 0 Total Long Term Liabilities: – 0

Total Liabilities: – 0

Shareholder’s Equity:

Non-Current Assets:

Total Equity – 0

Baking Equipment (Net) – 0

Total Assets: – 0 Total Liabilities & Equity – 0

Closing Entries

A Company

Closing Entries

Qtr ending 12/31/20xx

Date Accounts Debit Credit

31-Dec Bakery Sales

Merchandise Sales

Retained Earnings

31-Dec Retained Earnings

Baking Supplies Expense

Rent Expense

Wages Expense

Office Supplies Expense

Business License Expense

Office Expense

Depreciation Expense

Insurance Expense

Advertising Expense

Interest Expense

Telephone Expense

COGS

31-Dec Retained Earnings

Dividends

Post-Closing Trial Balance

A Company

Post-Closing Trial Balance

Qtr. Ending 12/31/20xx

Unadjusted Trial Balance

Account Debit Credit

Cash

Baking Supplies

Merchandise Inventory

Prepaid Rent

Prepaid Insurance

Baking Equipment

Accumulated Depreciation

Office Supplies

Accounts Receivable

Accounts Payable

Wages Payable

Interest Payable

Notes Payable

Common Stock

Retained Earnings

Total – 0 – 0

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