1/13/14 Serial Problem - 10
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1. value: 10.00 points
Serial Problem - 10 instructions | help
On October 1, 2011, Santana Rey launched a computer services company, Business Solutions, that is organized as a corporation and provides consulting services, computer system installations, and custom program development. Rey adopts the calendar year for reporting purposes and expects to prepare the company's first set of financial statements on December 31, 2011.
Oct. 1 S. Rey invested $50,000 cash, a $23,000 computer system, and $8,500 of office equipment in the company in exchange for common stock.
3 The company purchased $1,420 of computer supplies on credit from Harris Office Products. 6 The company billed Easy Leasing $5,500 for services performed in installing a new Web server. 8 The company paid $1,420 cash for the computer supplies purchased from Harris Office
Products on October 3. 10 The company hired Lyn Addie as a part-time assistant for $145 per day, as needed (paid weekly). 12 The company billed Easy Leasing another $1,400 for services performed. 15 The company received $5,500 cash from Easy Leasing as partial payment toward its account. 17 The company paid $710 cash to repair computer equipment damaged when moving it. 20 The company paid $1,683 cash for advertisements published in the local newspaper. 22 The company received $1,400 cash from Easy Leasing toward its account. 28 The company billed IFM Company $5,228 for services performed. 31 The company paid $1,015 cash for Lyn Addie's wages for seven days of work this month. 31 The company paid $2,900 cash for dividends.
Required: Enter the amount of each transaction on individual items of the accounting equation. Show new balances after each transaction. (Leave no cells blank - be certain to enter "0" wherever required. Amounts to be deducted, withdrawals and expenses should be indicated with a minus sign. Omit the "$" sign in your response.)
Assets Liabilities Equity
Date Cash + Accounts Receivable +
Computer Supplies + Computer System + Office Equipment =
Accounts Payable + Common Stock − Dividends + Revenues − Expenses
Oct. 1 $ $ $ $ $ $
$ $ $ $
3
Bal.
6
Bal.
8
Bal.
10
Bal.
12
Bal.
15
Bal.
17
Mariana CorreaACG 2071 Lab Class: ACG 2071 Lab - SPRING 2013-2
1/13/14 Serial Problem - 10
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Bal.
20
Bal.
22
Bal.
28
Bal.
31
Bal.
31
Bal. $ $ $ $ $ $
$ $ $ $
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It is the end of a reporting period. Because there are more people than usual retiring this year, your manager has asked your accounting department to create 2 things:
· A process documentation detailing the different methods of preparing income statements, specific sections of the income statement, and how to handle the special types of income statement items
· Basic financial statements for your company
Individual Portion:
1. Visit the SEC's Web site (http://idea.sec.gov/idea/searchidea/companysearch_idea.html).
· Select a company filing of your choice that contains a multiple-step income statement.
· Communicate your selection with your group (each of you should submit a different company).
· Submit the link to this filing as proof of your research.
2. Prepare a process documentation that
· is prepared in a professional manner because it will be the desktop guide used by others in the event of your absence to prepare the financial statements for Music Warehouse.
· is in the form of a memorandum or as a numbered listing of items, depending on your individual preference.
· includes the following elements:
· a definition and description of the specific sections of the income statement
· a description of the different methods of preparing income statements
· an explanation of the conceptual guidelines for reporting income
· how to handle the special types of income statement items
Please add your file.
Group Portion:
Using the information below, do the following:
· Prepare a multiple-step income statement for Music Warehouse.
· Prepare a statement of changes in stockholder's equity for Music Warehouse.
You may work together, or you may assign each group member a different financial statement or part of the assignment to work on.
Music Warehouse |
||
Adjusted Trial Balance |
||
December 31, 2008 |
||
|
||
|
Debit |
Credit |
Cash |
$24,675 |
|
Accounts Receivable |
5,625 |
|
Inventory |
65,980 |
|
Land |
93,000 |
|
Building |
289,000 |
|
Accumulated Depreciation |
|
75,000 |
Notes Payable |
|
85,000 |
Accounts Payable |
|
53,600 |
Interest Payable |
|
4,750 |
Common Stock |
|
10,000 |
Additional Paid-in Capital |
|
120,000 |
Dividends |
10,000 |
|
Retained Earnings |
|
59,980 |
Sales |
|
937,500 |
Sales Discounts |
22,675 |
|
Cost of Goods Sold |
723,000 |
|
Salaries |
81,000 |
|
Utilities |
8,900 |
|
Repairs & Maintenance |
5,225 |
|
Telephone |
2,850 |
|
Interest Expense |
4,400 |
|
Depreciation Expense |
9,500 |
|
|
|
|
|
$1,345,830 |
$1,345,830 |
The following is additional information needed for financial-statement preparation:
· Loss as a result of hurricane damage on the building: $17,000 (assume that the building is not located in an area that sustains frequent hurricane damage.)
· Loss because of the discontinuation of the cassette tape music segment: $26,875
· Beginning of the year balance of common stock: $8,000 (assume that changes are related to issuance of common stock.)
· Beginning of the year balance of additional paid-in capital: $102,000
· Effective income tax rate: 35%
Please add your file.
The following grading criteria will apply to this assignment:
Grading Criteria |
|
Individual Portion |
|
Submit a link to a company filing of your choice that contains a multiple-step income statement as proof of your research. |
10% |
Prepare process documentation that · is prepared in a professional manner because it will be the desktop guide used by others in the event of your absence to prepare the financial statements for Music Warehouse. · is in the form of a memorandum or as a numbered listing of items, depending on your individual preference. · includes the following: · a definition and description of the specific sections of the income statement · a description of the different methods of preparing income statements · an explanation of the conceptual guidelines for reporting income · how to handle the special types of income statement items |
30% |
Group Portion |
|
Prepare a multiple-step income statement for Music Warehouse. |
30% |
Prepare a statement of changes in stockholder's equity for Music Warehouse. |
30% |
TOTAL |
100% |
This assignment will be assessed using the rubric provided here .
For assistance with your assignment, please use your text, Web resources, and all course materials.
Unit Materials
|

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