Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Dear Newbie, Welcome to Hampton! My name is Julio Antoni, your supervisor. We believe the best way for you to get familiar with what you

Dear Newbie, Welcome to Hampton! My name is Julio Antoni, your supervisor. We believe the best way for you to get familiar with what you are going to be doing here is to throw you right in, so we are asking you to start working on the books for us right away. For this project you will complete Hampton's entire accounting cycle. You will be required to record entries in a journal, post to a ledger, complete a trial balance, and prepare financial statements. Transactions will include day to day operations, adjusting entries, dividends and closing entries. All of the work will be completed in the provided Excel workbook. Company Information Hampton Accounting Service Inc. is a public corporation that has been in business for 1 year. The company is authorized to issue 100,000 shares of common stock at $1 par value. The company provides accounting services and sells accounting software. To date the company has issued 20,000 shares of common stock, which are still outstanding. The issued shares were sold at $10 per share. A building and furnishings were purchased at the start of the year. The cost of the building was $140,000 and the cost of the furnishings was $30,000. The depreciation will be recorded annually. The estimated useful life of the building is 20 years with a residual value of $10,000. The company uses the Straight line method to depreciate the building. The estimated useful life of the furnishings is 5 years with a residual value of $2,500. The company uses the Double Declining Balance method to depreciate furnishings. The current inventory consists of 30 units of software at a cost of $140.00 each. Inventory is costed using LIFO and the perpetual inventory system. The company uses an allowance method to account for uncollectible accounts. It is estimated that 1% of net credit revenue will be uncollectible, adjusted monthly. Employees are paid $2,500 salary twice a month, on the 16th for the first half of the month and on the 2d of the following month for the last half of the month. Ignore income tax calculations. Project Requirements 1. Opening balances- The opening balances for select accounts are provided in the appropriate ledger accounts. 2. Record the following transactions in the journal and post to the ledger: 12/02/13- Purchased 10 Units of Software on Account for $1,300 12/02/13- Paid employees Salaries owed Project Requirements 1. Opening balances- The opening balances for select accounts are provided in the appropriate ledger accounts. 2. Record the following transactions in the journal and post to the ledger: 12/02/13- Purchased 10 Units of Software on Account for $1,300 12/02/13- Paid employees Salaries owed 12/02/13- Provided Accounting Service on Account, $3,200 12/05/13- Purchased Computer Equipment on Account, $4,800 Note: The equipment has an estimated useful life of 4 years, residual value of $50 and uses the DDB method. 12/08/13- Purchased Supplies for $800 cash BUS-A 201 Introduction to Financial Accounting Accounting Cycle Project 12/10/13- Received $3,000 payment on account 12/11/13-Sold 15 units of Inventory on Account, $4,500 12/11/13- Made payment on Account, $1,000 12/12/13-Purchased 20 units of Inventory on Account, $2,400 12/14/13-Received a bill for Advertising and paid it, $250 12/15/13-Provided Accounting service for Cash, $8,000 12/16/13-Paid employees salary for Dec. 1-15 12/17/13- Provided Accounting Service on Account, $6,000 12/19/13-Sold 10 units of Inventory on Account, $3,000 12/22/13-Received $2,500 payment on Account 12/23/13-Made payment on Account, $2,500 12/24/13- Received and paid monthly Utility bills, $850 12/27/13-Received $2,000 cash in advance for accounting services 12/29/13- Provided Accounting Service for Cash, $5,000 12/30/13-Issued 1,000 shares of Common Stock at $15 per share 12/31/13-Declared dividends of $1.50 to outstanding shareholders as of 12/31/13. NOTE: Be sure to debit retained earnings and credit dividends payable. 3. Prepare a trial balance to verify that total debits equal total credits. 4. Record the following adjustments in the journal and in the trial balance. DO NOT post the adjusting entries to the ledger. Instead, post them directly as adjustments to the trial balance. 12/31/13-Employees salary for Dec. 16-31 17/13-Provided Accounting Service on Account, $6,000 12/19/13-Sold 10 units of Inventory on Account, $3,000 12/22/13- Received $2,500 payment on Account 12/23/13- Made payment on Account, $2,500 12/24/13- Received and paid monthly Utility bills, $850 12/27/13- Received $2,000 cash in advance for accounting services 12/29/13- Provided Accounting Service for Cash, $5,000 12/30/13- Issued 1,000 shares of Common Stock at $15 per share 12/31/13-Declared dividends of $1.50 to outstanding shareholders as of 12/31/13. NOTE: Be sure to debit retained earnings and credit dividends payable. 3. Prepare a trial balance to verify that total debits equal total credits. 4. Record the following adjustments in the journal and in the trial balance. DO NOT post the adjusting entries to the ledger. Instead, post them directly as adjustments to the trial balance. 12/31/13- Employees salary for Dec. 16-31 12/31/13- Depreciation on Building, use SL method (calculate for entire year) 12/31/13- Depreciation on Furnishings, use DDB method (calculate for entire year) 12/31/13- Depreciation on Computer Equipment, use DDB method (calculate for one month) 12/31/13- Supplies on hand equal $1,625 12/31/13- Inventory count shows 33 units, some damaged units were disposed of during the month 12/31/13- $500 of advance payment was earned in December 12/31/13- Uncollectible Account expense for December 5. Prepare an Adjusted trial balance to verify debits equal credits at the end of the month 6. Prepare the 3 main financial statements for the year ending December 31, 2013. Adjusted Trial Balance Debit Credit $ 36,869.00 $ $ 36,869.00 $ + HAMPTON ACCOUNTING SE Income Statement For the Year Ending December 31, 2023 Service Revenue 5 Sales Revenue Net Revenue Cost of Goods Sold 9 Gross Profit 0 Operating Expenses 1 Advertising Expense 2 Depreciation Expense 3 Repairs & Maintenance 4 Supplies Expense Uncollectible Accts Expense Utilities Expense 5 6 7 Salary Expense 18 Total Operating Expense 19 Net Income $ $ $ $ SS Statement of Retained Earnings For the Year Ending December 31, 2023 Retained Earnings, January 1 Add: Net Income Less: Dividends Retained Earnings, December 31 $ es $ Assets Current: 5 5 Long-Term: 7 8 9 0 21 22 23 Cash Accounts Receivable $ Less: Allowance for Unc. Accounts $ [enter here] [enter here] Total Current Assets [enter here] [enter here] [enter here] (enter here] [enter here] [enter here] 24 Total Assets Total Long-term Assets $ 36,869.00 $ 36,869.00 $ $ $ $ $ 36,869.00 Inc 25 26 Liabilities 27 Current: 28 Accounts Payable 29 [enter here] 30 [enter here] 31 [enter here] 32 Total Current Liabilities $ 33 Stockholders Equity 34 [enter here] 35 36 Additional Paid in Capital Retained Earnings 37 Total Liabilities & Stockholders Equity 38 $ 39 Total Assets should equal Total Liabilities + Stockholders Equity 40

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

Describe the Indian constitution and political system.

Answered: 1 week ago

Question

Explain in detail the developing and developed economy of India

Answered: 1 week ago

Question

Problem: Evaluate the integral: I = X 52+7 - 1)(x+2) dx

Answered: 1 week ago

Question

What is gravity?

Answered: 1 week ago

Question

What is the Big Bang Theory?

Answered: 1 week ago