11/17/22, 5:08 PM Milestone Two Guidelines and Rubric - ACC-201-R2129 Financial Accounting 22EW2

https://learn.snhu.edu/d2l/le/content/1188155/viewContent/21410120/View 1/3

Milestone Two Guidelines and Rubric

Overview

In Milestone One, you completed the first part of your course project to demonstrate your ability to accurately record financial data.

In Milestone Two, you will use your trial balance results from Milestone One to create financial statements. These financial

statements will be part of the Summary Report that you will present to your employer in Module Seven.

Scenario

You were recently hired as an entry-level bookkeeper for a service business that recently opened. This is the first month in opera�on

for the business and your first task is to record business transac�ons for their first month using the source documents and

transac�on data the owner will provide to you. Because this is a small business that does not use computerized accoun�ng, you will

apply the accoun�ng cycle in Excel to record transac�ons and generate financial repor�ng results for the owner.

Direc�ons

Report Financial Results: Use the account balances from the Trial Balance generated through the recording process in Milestone

One to prepare the income statement, statement of owner’s equity, and balance sheet for the company. Then close temporary

account balances using closing entries in the final step. Be sure to revisit any feedback received from Milestone One and make

necessary correc�ons to ensure that statements are completed with accurate balance informa�on. (You may refer to the blank

Company Accoun�ng Workbook Template if necessary, but keep in mind that your work for this milestone should be added to the

work that was completed in your workbook for the previous milestone. You should also implement any feedback that was given

during Milestone One.)

Specifically, you must address the following rubric criteria:

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 Assets: Prepare the balance sheet asset entries using the adjusted trial balance.

Balance Sheet Liabili�es: Prepare the balance sheet liabili�es entries using the adjusted trial balance.

Closing Entries: Complete the “Closing Entries” tab of the company accoun�ng workbook by closing all temporary income

statement amounts to create closing entries.

Guidelines for Submission

Build on your work from Milestone One to complete the “Income Statement,” “Statement of Stockholder’s Equity,” “Balance Sheet,”

and “Closing Entries” tabs in your company accoun�ng workbook. This should be completed and submi�ed using Microso� Excel.

Please refer to the video walkthrough linked below if you need more assistance with your submission.

Suppor�ng Materials

The following resources support your work on the project:

Video: Milestone Two Walkthrough (13:28)

This video walkthrough is available if you need addi�onal assistance comple�ng this milestone. The video uses a sample data set for

illustra�ve purposes.

A video transcript is available: Transcript for ACC 201 Milestone Two Walkthrough

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ACC-201-R2129 Financial Accounting 22EW2 LP

11/17/22, 5:08 PM Milestone Two Guidelines and Rubric - ACC-201-R2129 Financial Accounting 22EW2

https://learn.snhu.edu/d2l/le/content/1188155/viewContent/21410120/View 2/3

Milestone Two Rubric

Criteria Exemplary (100%) Proficient (85%) Needs Improvement

(55%) Not Evident (0%) Value

Income Statement Prepares the income statement using the adjusted trial balance with no errors

Prepares the income statement using the adjusted trial balance with minimal errors

Prepares the income statement using the adjusted trial balance with significant errors

Does not a�empt criterion

20

Financial Statements: Statement of

Owner’s Equity

Prepares the statement of owner’s equity using the adjusted trial balance with no errors

Prepares the statement of owner’s equity using the adjusted trial balance with minimal errors

Prepares the statement of owner’s equity using the adjusted trial balance with significant errors

Does not a�empt criterion

20

Financial Statements:

Balance Sheet Assets

Prepares the balance sheet assets using the adjusted trial balance with no errors

Prepares the balance sheet assets using the adjusted trial balance with minimal errors

Prepares the balance sheet assets using the adjusted trial balance with significant errors

Does not a�empt criterion

20

Balance Sheet Liabili�es

Prepares the balance sheet liabili�es using the adjusted trial balance with no errors

Prepares the balance sheet liabili�es using the adjusted trial balance with minimal errors

Prepares the balance sheet liabili�es using the adjusted trial balance with significant errors

Does not a�empt criterion

20

Closing Entries Completes closing entries by closing all temporary income statement amounts to create closing entries with no errors

Completes closing entries by closing all temporary income statement amounts to create closing entries with minimal errors

Completes closing entries by closing all temporary income statement amounts to create closing entries, but there are significant errors

Does not a�empt criterion

20

Total: 100%

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 Owner's Capital 301
Accounts Receivable 102 Accounts Payable 202 Owner Draws 302
Prepaid Rent 103 Wages Payable 203
Office Furniture 104
Office Supplies 105
Accumulated Depreciation (contra asset) 106
Revenue Accounts
Acct #
Service Revenue 401
Expense Accounts
Acct #
Rent expense 501
Business License Expense 502
Insurance Expense 503
Repairs and Maintenance 504
Advertising Expense 506
Wages Expense 507
Utilities Expense 508
Depreciation Expense 509
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

General Journal

A Company
General Journal Entries Journal Entry Tips
The debited account is recorded first, credited account recorded second.
Debits and credits must always equal!
Date Accounts Debit Credit There can be compound entries in which two accounts receive a debt to an equivalent credited amount to one account.
Mar 1. Cash 125,000.00 Be sure to use your chart of accounts (the first page of this workbook).
Notes Payable 125,000.00 Each account you will record to is already listed and organized by classification of the account.
(To record amount borrowed)
Mar 1. License Expense 250.00
Cash 250.00
(To record license expense paid)
Mar 2. Rent Expense 950.00
Cash 950.00
(To record rent expense incurred)
Mar 5. Office Furniture 2,750.00
Cash 15,000.00
Owner's Capital 17,750.00
(To record furniture & Cash Contributed)
Mar 6. Cash 650.00
Service Revenue 650.00
(To record service revenue earned)
Mar 8. Advertising Expense 500.00
Accounts Payable 500.00
(To record advertising expense incurred)
Mar 10. Accounts Receivable 1,725.00
Service Revenue 1,725.00
(To record service revenue earned on account)
Mar 15. Insurance 750.00
Cash 750.00
(To record insurance expense incurred)
Mar 20. Utilities Expense 135.00
Accounts Payable 135.00
(To record utilities expense incurred)
Mar 22. Owner's Withdrawal 500.00
Cash 500.00
(To record amount withdrawn for personal use)
Mar 25. Office Supplies 215.00
Cash 215.00
(To record supplies purchsed)
Mar 25. Cash 350.00
Service Revenue 350.00
(To record service revenue earned)
Mar 30. Accounts Payable 500.00
Cash 500.00
(To record payment made on account)
Mar 30. Cash 1,725.00
Accounts Receivable 1,725.00
(To record amount received on account)
Mar 31. Salaries Expense 275.00
Salaries Payable 275.00
(To record salaries expense incurred)
Mar 31. Accounts Receivable 3,500.00
Service Revenue 3,500.00
(To record service revenue earned on account)
Mar 31. Depreciation 46.00
Accumulated Depreciation - Office Furniture 46.00
(To record depreciation expense incurred)
Total 154,821.00 154,821.00 If Red, this means your debits and credits do not equal. Be sure to review for errors.

Ledger Accounts

Assets Liabilities Equity Revenue Expenses
Cash Notes Payable Owner's Capital Service Revenue Rent Expense
$ 125,000.00 $ 250.00 $ 125,000.00 $ 17,750.00 $ 650.00 Mar 6. Mar 2. $ 950.00
$ 15,000.00 $ 950.00 $ 1,725.00 Mar 25.
$ 650.00 $ 750.00 $ 350.00 Mar 25.
$ 350.00 $ 500.00 $ 3,500.00 Mar 31.
$ 1,725.00 $ 215.00
$ 500.00
$ 142,725.00 $ 3,165.00 $ - 0 $ 125,000.00 $ - 0 $ 17,750.00 $ - 0 $ 6,225.00 $ 950.00 $ - 0
End Bal $ 139,560.00 End Bal $ 125,000.00 End Bal $ 17,750.00 End Bal $ 6,225.00 $ 950.00
Accounts Rec. Accounts Payable Owner Draws Business License Expense
Mar 10. $ 1,725.00 $ 1,725.00 Mar 30. Mar 30. $ 500.00 $ 500.00 Mar 8. Mar 22. $ 500.00 Mar 1. $ 250.00
Mar 31. $ 3,500.00 $ 135.00 Mar 20.
$ 5,225.00 $ 1,725.00 $ 500.00 $ 635.00 $ 500.00 $ - 0 $ 250.00 $ - 0
End Bal. $ 3,500.00 $ 135.00 End Bal $ 500.00 $ 250.00
Prepaid Rent Wages Payable Insurance Expense
Mar 2. $ 950.00 $ 275.00 Posting to the ledger/t accounts Mar 15. $ 750.00
Don't overthink it!
You are just posting each debit and credit from the journal entries to the account you identified in the entry.
These accounts are set to calculate your balances for you.
Please be careful not to delete the running totals as those will calculate the ending balance.
The ending balance will transfer to the Trial Balance sheet.
If you have posted all entries and your trial balance is not in balance (total debits = total credits),
$ 950.00 $ - 0 $ - 0 $ 275.00 this means that there is an error. $ 750.00 $ - 0
End Bal $ 950.00 End bal $ 275.00 $ 750.00
Office Furniture Repairs & Maint.
Mar 5. $ 2,750.00
$ 2,750.00 $ - 0 $ - 0 $ - 0
End Bal $ 2,750.00 $ - 0
Office Supplies Advertising Expense
Mar 25. $ 215.00 $ 500.00
$ 215.00 $ - 0 $ 500.00 $ - 0
End bal $ 215.00 $ 500.00
Accumulated Depreciation Wages Expense
$ 46.00 Mar 31. $ 275.00
$ - 0 $ 46.00 $ 275.00 $ - 0
End Bal $ (46.00) $ 275.00
Utilities Expense
$ 135.00
$ 135.00 $ - 0
$ 135.00
Depreciation Expense
$ 46.00
$ 46.00 $ - 0
$ 46.00

Trial Balance

Trial Balance
As of 03/31/20XX
Unadjusted trial balance
Account Debit Credit Trial Balance
Cash 139,560.00 Balances from the t accounts will autofill your trial balance.
Accounts Receivable 3,500.00 If total debits do not equal total credits in the trial balance, you know you have an error.
Prepaid Rent These are the balances that will be used to prepare the financial statements.
Office Furniture 2,750.00 Be sure to implement feedback provided by your instructor for this Milestone One submission!
Office Supplies 215.00
Accumulated Depreciation 46.00
Notes Payable 125,000.00
Accounts Payable 135.00
Wages Payable 275.00
Owner's Capital 17,750.00
Owner Draws 500.00
Service Revenue 6,225.00
Rent Expense 950.00
Business License Expense 250.00
Depreciation Expense 46.00
Insurance Expense 750.00
Repairs and Maintenance Expense - 0
Advertising Expense 500.00
Wages Expense 275.00
Utilities Expense 135.00
Retained Earnings
Total: 149,431.00 149,431.00
Debits should equal credits
`

Income Statement

A Company
Income Statement
For Month ending 3/31/20XX
Revenues
$ 6,225.00
Total Revenues $ 6,225.00
Operating Expenses:
Buwines License $ 250.00
Advertising Exp $ 500.00
Insurance Exp $ 750.00
Maintenance Exp $ 95.00
Total Operating Expenses: 1,595.00
Net Income 4,630.00

Statement of Stockholder Equity

Company Name
Statement of Owner's Equity
Period Ending 03/31/20XX
Beginning Capital on 3/01/20XX $ - 0
Increases to capital
Net income/loss: $ 4,630.00
Owner Contributions $ 17,750.00
Subtotal: $ 22,380.00
Decreases to capital
Owner Draws 500
Ending Equity as of 03/31/20XX $ 22,380.00

Balance Sheet

A Company
Balance Sheet
As of March 31, 20XX
Assets Liabilities and Owners' Equity
Current Assets: Current Liabilities:
Cash 138,515.00 Accounts Payable 410.00
Office Supplies 215.00 Total Current Liabilities 410.00
Accounts Receivables 3,500.00 Long Term Liabilities:
125,000.00
Total Current Assets 142,230.00 Total Long Term Liabilities: 125,000.00
Total Liabilities: 125,410.00
Owner's Equity
Owner's Capital 17,250.00
Non-Current Assets: Add Net Income 2274
Office Furniture 2,750.00
Less Depreciation (45.88) Total Equity 19,524.00
Total Non Current/Fixed Assets 2,704.17
Total Assets: 144,934.17 Total Liabilities & Equity 144,934.00 <== Total Assets on the left should equal Liabilities + Owner's Equity on the right.

Closing Entries

A Company
Closing Entries
Month ending 03/31/20XX
Date Accounts Debit Credit
31-Mar Revenues 6,225.00
Income Summary 6,225.00
Close revenues
31-Mar Income Summary 3,951.00
Business License 250.00
Advertising Exp 500.00
Insurance Exp 750.00
Maintenance Exop 95.00
Wages Exp 275.00
Dep. Exp 45.83
Utility Exp 135.00
Rent Exp 1,900.00
Close Expenses
31-Mar Owner's Capital 2,274.00
Close Income Summary 2,274.00
31-Mar
Close Dividends
22,544.00 2,355.83

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