Comprehensive Accounting Project
Team, you have been called in to help Sarah Singer who has operated a part-time graphic design business from her home. Her accountant has decided to quit working for her and Singer has decided she needs a more organized approach to keeping his accounting records. (Singer has kept his accounting records in a big file cabinet). Singer has decided to move to a rented office space and is planning to operate the business on a full-time basis. The business will be known as Sarah’s Designs, Inc. Singer also has the following transactions that took place during the month of Sept 2
0
XX:
· Sept 1. The following assets were received from Sarah Singer in exchange for common stock: Cash, $ 25,800; accounts receivable, $ 4,500; supplies, $2,500 and Office Equipment, $ 16,500. There were no liabilities received.
· Sept 1. Paid three months’ rent in advance on a lease rental contract, $3,600.
· Sept 2. Paid the premiums on property and casualty insurance policies, $ 1,800. ( The policy is for six months)
· Sept 4. Received cash from the Gaines Company as an advance payment for services to be provided and it will be recorded as unearned fees for $ 4,200.
· Sept 5. Purchased a new computer on account from Brown’s Computer Nook for $ 3,600. The useful life has been determined to be 5 years.
· Sept 6. Received cash from clients on account for $ 2,600.
· Sept 9. Paid cash to the Mason Tribune for a newspaper advertisement, $ 240.
· Sept 12. Recorded services provided on account to various clients for the period of September 1 thru 12, for $ 5,700.
· Sept 13. Paid Brown’s Computer Nook for part of the liability incurred on Sept 5, $ 690.
· Sept 14. Paid part-time receptionist for two weeks’ salary, $ 1,100.
· Sept 17. Paid cash for supplies, $ 1,000.
· Sept 20. Purchased additional office equipment on account from Cabrillo Office Supply store for $ 2,650.
· Sept 20. Recorded services provided on account to various clients for the period of Sept 13-20, $ 4,360.
· Sept 24. Received cash from clients for fees earned during the period of Sept 17 thru 24, $ 6,100.
· Sept 26. Received cash from clients on account from Sept 12 services, $ 2,200.
· Sept 27. Paid part-time receptionist for two weeks salary, $ 1,100.
· Sept 29. Paid telephone bill for September, $ 370.
· Sept 29. Paid electricity bill for September, $ 515.
· Sept 30. Recorded cash from clients for fees earned for the period of Sept 25-30, $ 3,450.
· Sept 30. Recorded services provided on account for the remainder of Sept, $ 2,100.
· Sept 30. Paid dividends of $ 2,500.
Possible adjustment data for Sarah’s Designs, Inc. as of Sept 30, 20XX:
a. Insurance expired during Sept is $300.
b. Supplies on hand on Sept 30 is $ 2,130.
c. Monthly depreciation of office equipment is $ 320.
d. Monthly depreciation of computer is $ 60
e. Rent expired during Sept is $1,200.
f. Accrued receptionist salary on Sept 30 is $ 200.
g. Unearned fees on Sept 30 is $ 3,600.
Deliverables for this project:
· Your job is to review the transactions and help Sarah Singer develop a chart of accounts that Sarah’s Designs, Inc. will utilize in the future.
· Your next task to record these transactions using Excel. You will need to create a general journal and a general ledger for Sarah’s Designs, Inc.
After the recording the transactions and posting the transactions into the general journal and general ledger that you have created, please complete the following tasks:
For Course Project Milestone 1: (Due at the end of Week 3)
· Design a chart of accounts
· Prepare the general journal entries for the above transactions.
· Post the transactions to the general ledger
· Prepare an unadjusted trial balance for Sept 30, 20XX
For Course Project Milestone 2: (Due at the end of Week 5)
· Prepare the adjusting entries
· Post the adjusting entries to the general ledger
· Prepare the adjusted trial balance
· Prepare the financial statements for the month of September
For Course Project Milestone 3: (Due at the end of Week 7)
· Prepare the closing entries
· Post the closing entries to the general ledger.
· Prepare the post-closing trial balance.
· Prepare the written memorandum for your client highlighting software selection and recommendations.
Suggested practice: Create tabs in the Excel worksheet to help with each of these tasks.
Final Requirement: Once these tasks are completed please prepare a PowerPoint presentation that will highlight the following:
· Creation of your chart of accounts
· General Journal Entry Presentation
· Creation of General Ledger which highlights posting of transactions for the month along with posting the adjusting and closing entries.
· Unadjusted Trial Balance
· Adjusted Trial Balance
· Financial Statement Preparation
· Closing Entry Preparation
· Post-Closing Trial Balance
· 1-2 page memo recommendation to Sarah regarding the possibility of acquiring an accounting package to meet the needs of her organization.
Grading Rubrics
Course Project Milestone 1
Possible Points
Excellent
Competent
Fair
Poor
Unacceptable
20
18-20
15-17
14-11
1-10
Correct types of accounts are created. Proper account numbering system being used
Necessary types of accounts are created. Minor errors in account set up.
Some key accounts are missing. Errors in account set up and account numbering system not used properly.
Major accounts are missing, unnecessary accounts are created. No evidence of account numbering system being used at all.
The creation of the chart of accounts does not meet the standard, or are not presented.
15
13-15
10-12
7-9
1-6
0
Design of General Journal and Ledger is easy to follow and audit trail is established and entered correctly.
Design of General Journal and Ledger is easy to follow. Minor errors in design and set up.
Design of General Journal and Ledger does not leave an audit trail. Unable to determine ending balance.
Does not meet the standards and does not leave an audit trail. Information does not transfer to trial balance or financial statements.
The design of general journal and general ledger does not meet the standards, or are not presented.
15
13-15
10-12
7-9
1-6
0
Accounts are listed correctly and in the proper order leading to an accurate trial balance.
Most accounts are listed correctly leading to a mostly correct trial balance.
Listing of accounts has several errors leading to an incorrect trial balance.
Listing of accounts is done poorly and or not completed at all, leading to an inaccurate or no trial balance.
The work did not meet the standards, or are not presented.
50
Course Project Milestone 2
|
TCO Covered |
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|
Adjusting Journal Entries |
1, 2, 6 |
14-17 |
10-13 |
0-9 |
|||||||||
|
Journal entries use accurate accounts and amounts and debits and credits are used correctly. |
Journal entries use mostly accurate accounts and amounts and debits and credits are used correctly. |
Journal entries have some errors in use of accounts and amounts and debits and credits are used somewhat correctly. |
Journal entries have some errors in use of accounts and amounts and debits and credits are not used correctly. |
The submission does not meet this requirement. |
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|
Preparation of Adjusted Trial Balance |
25 |
23-25 |
20-22 |
14-19 |
1-13 |
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|
Posting is correct leading to an accurate trial balance. |
Posting is mostly correct leading to a mostly correct trial balance. |
Posting has several errors leading to a trial balance with several errors. |
Posting is done poorly or not at all, leading to inaccurate or no trial balance. |
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|
Preparation of Financial Statement |
30 |
27-30 |
23-26 |
17-22 |
1-16 |
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|
All statements are prepared completely and accurately. |
All statements are prepared accurately, but has minor errors. |
The statements are prepared with several errors. |
The statements are prepared with significant errors. |
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Total Points |
75 |
Course Project Milestone 3
|
Closing Journal Entries |
15-17 |
11-14 |
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|
Post-Closing Trial Balance |
28-30 |
24-27 |
18-23 |
1-7 |
|
Written Memo and Recommendations |
46-50 |
40-45 |
30-39 |
1-29 |
|
Memo is written in a professional manner. Recommendations are made and memo is free of grammatical errors. |
Memo is written in a professional manner. Recommendations are made and there are slight grammatical errors. |
Memo has grammatical errors, spelling errors and recommendations are not clearly made and features of the software are not made clear. |
Memo has significant spelling and grammatical errors. Recommendations are not made and is written very poortly. |
|
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100 |
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