ACC 255 Comprehensive Problem 1 Part B

SECTION SCORE ACC 255 SPRING 2020 COVER SHEET FOR PART B COMPREHENSIVE PROBLEM 1 (CHAPTERS 1, 3, 4) INSTRUCTIONS: Complete all requirements for the compreher Si complete all requirements for the comprehensive problem and turn in the original your problem (stapled) by the due date & time specified by you tapled by the due date & time specified by your professor. No late problems will b For any reason! You should take pictures of your solution to check your answers with the solutions which will be provided on BbLearn. REQUIREMENTS Part B: (3) PREPARE FINANCIAL STATEMENTS: INCOME STATEMENT STATEMENT OF RETAINED EARNINGS BALANCE SHEET (4) PREPARE CLOSING ENTRIES POST CLOSING ENTRIES TO INCOME SUMMARY & RETAINED EARNINGS Page 150 COMPREHENSIVE PROBLEM 1 PART B (CHAPTERS 1, 3, 4) The purpose of Comprehensive Problem is to review and reinforce your understanding of the accounting cycle. The number of accounts included in this comprehensive problem has been kept to a minimum so that you can simulate what might happen in actual practice without unnecessary redundancy or excessive time requirements BACKGROUND Som and Ben considered the first year of operations of Sparkle Pool & Spa Services, Inc. a success. They have asked you to prepare the company's financial statements and perform the year-end closing process After all the transactions and adjusting entries from the fiscal year were recorded and posted to the accounts, the September 30, 2020 year-end adjusted trial balance (with accounts listed in alphabetical order) was prepared and is presented on the following page. COMPREHENSIVE PROBLEM 1 REQUIREMENTS Part B (use the September 30, 2020 adjusted trial balance on the following page to complete the below requirements): (3) Prepare, in good form, the 2020 fiscal year financial statements (a) Income Statement: Check figure: Net Income = $23,410. (b) Statement of Retained Earnings: Check figure: Retained Earnings, September 30, 2020 = $11,410 (c) Balance Sheet: Check figure: Total Assets $87,490. Prepare the year-end closing entries in the general journal (all CJEs are dated September 30). Check figure: Total debits = $448,000, (5) Post the closing entries to Income Summary and Retained Earnings in the general ledger and compute the ending balances of these accounts. DISCOVERY OF ERRORS If your FINANCIAL STATEMENT amounts do not agree with the check figures: (1) Remember that each account is included in only one statement: check each account off as it is used. (2) Calculate the difference between your amount and the check figure and then look for accounts that are (a) included on a particular statement but should not be, or (b) omitted 4,700 COMPREHENSIVE PROBLEM 1 PART B (CHAPTERS 1, 3, 4) Page 151 SPARKLE POOL & SPA SERVICES, INC. ADJUSTED TRIAL BALANCE SEPTEMBER 30, 2020 Accounts Payable ACCOUNT TITLES DEBIT CREDIT Accounts Receivable $ 5,600 Accumulated Depreciation-Computers $ 11,800 1,260 Accumulated Depreciation-Truck 6,600 Advertising Expense Cash 43,000 Common Stock 40,000 Computers 3.780 Depreciation Expense 7,860 Dividends 12,000 Income Taxes Expense 8,800 Insurance Expense 900 Interest Expense 1,680 Interest Payable 1,680 Legal Fees Expense 850 Notes Payable 24,000 Prepaid Insurance 900 Rent Expense 15,300 Retained Earnings (October 1, 2019) Salaries & Wages Expense 140,000 3,500 Salaries & Wages Payable 218,000 Service Revenue 2,870 Supplies 10,000 Supplies Expense 33,000 Truck 1,300 Unearned Service Revenue 4,500 Utilities Expense $ 301.940 $ 301.940 TOTALS Page 152 COMPREHENSIVE PROBLEM 1 PART 3 (CHAPTERS 1, 3, 4) SPARKLE POOL & SPA SERVICES, INC. INCOME STATEMENT COMPLETE THE DATE LINE SHI SPARKLE POOL & SPA SERVICES, INC. STATEMENT OF RETAINED EARNINGS COMPLETE THE DATE LINE >> Page 153 COMPREHENSIVE PROBLEM 1 PART 3 CHAPTERS 1. 3. 4) SPARILE POOL & SPA SERVICES, INC. BALANCE SHEET COMPLETE THE DATE LINE > Page 154 COMPREHENSIVE PROBLEM 1 PART B (CHAPTERS 1, 3, 4) GENERAL JOURNAL DEBIT ACCOUNT TITLES DATE CREDIT 2020 CLOSING ENTRIES: GENERAL LEDGER T-ACCOUNTS (partial list) Retained Earnings #312 Income Summary #314