Demonstrate knowledge of the accounting cycle and financial statements through analysis, preparation, and interpretation of accounting data. o Prepare general journal entries o Post general journal entries
Prepare an unadjusted trial balance.
o Prepare adjusting journal entries for accruals, deferrals, and depreciation. o Post adjusting entries
Prepare an adjusted trial balance by preparing a worksheet.
Analyze and utilize knowledge for financial reporting. o Prepare financial statements from adiusted account balances.
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Analyze results of financial statements
CLASSIC UPHOLSTERY SHOP, INCt YOU ARE THE ACCOUNTANT Tyler Simiah had woiked ia an whbolstery ahop for 10 years, Last ycar, Tyler's wages were \$20,000. Lately. Tyler had boes unhappy with the chop's owner, Convinced thir le coold nan an upbolstery shop that did better work at a lower coet, Tyler doclated io go into burines fse henatif during 2021 and cpenel Clasic Upholstery Shop, Inc. He organirod hit business a a corponcice and depovised 590000 into a busines bank account in exchange for shares of coensos atock. To get the businesigoiog. Tyler decided to invent beavily in advetining. He spent 59.066cm athertising aimed at coesumers and anoeber 51,000 on advertising aimed at getting asth ffum interior decorakon and intenor design sores. Tyler also purchased indeatrial sewing mackisen costing $5,000 and other tools and equipment coiting $4,000. He elimated that the sewesc machines can be used fot aboet five years before maintenance conts will be toe bigh and the machines will need to be replaced. The other tools and oquipment are ted as duanbit and will have to be roplaced in three yoars. At the end of the first year of business, Tyler had received 5100,000 in cach from cuastars for hopilsery work. Tyler was owed another 55,300 from customers who are not fequind is puy eash bat are billed every 30 days. A rovicw of Tyler's checkbook shows he pald the following expenses in cash (m addition to those mentioned previously) during the first year of business: 1. Upholstery fabric 550,000 2. Ouher sqpilies invemory $10,000 3. Wager pars-time assistant 59,500 4. Rent 54,800 5. Invurance (two-year policy) $3,200 6. Utilwies 51,200 7. Professional expenses $1,700 8. Tylet's cuitiny bill foe the bas motih of the year has nof artived. He escimutes the the bil. will be approximately $320. 9. Tyler keeps seme stock of uphobwery fabrio in populur colors on hand for cectomers whe 4o not want io wait for special-order fabric io arrive. a. At the end of the year, about 514,000 of the fibric purcbiasod durits the year was in bis store slock b. In additice, \$2,300 in supplies had nok been used. tht. You do NOT have to turn in the analysis yet. post general and adjusting journal entries for the year ended Pecember 31 . 2021. Yo Denwontrate lasowledge of the accounting oyele and financial statemients t regh analysis, mreparation, and interptctstioe of accountine data Propate efcenen joumal entrits - Postegencal journal entrits (0. Prepare an vinajjusted trial balance. th Prepare afjusting joureal everies for accruals, defertals, and drpecciaticie - Post adjusting entries o. Propare an idjusted Irial bolance by pecparing a workheet. * Analyze asd utilise lenowlodgo for fitancial reportiog. in Propare financial statcmetets from ddjustod account balinces. 6. Analyre results of financial statements Steps you will take: There ure two templiates that you will use to avtrplete this assigment Claikie Upholvery Shop Tcmpletes to Tam In Fiscel Documet - Classie Upholdery Shop Finuncial Analyan Tenplace so Turn in Wond Document Betoce you begin the masignment, please change the nume of the docamenls by teplacing 7ad Tim fithe sid laat name oen bedh socumenti. For esample. I would save my filen au follows: - Cunie Uphotsiery Stwp Templakes Jentiler Coer Pieate auve therm and begis the assigrmed. Catnat. Tt. You do NOOT have to tuin in the analysis yet. post goneral ard adjusting journal entries for the year ended December 31 . 20221 . rou wo. Part1 1. Record the eksh activity ONLY as general joumal entries oo the "GItEs and AJE" tab. You can break these up into more joumal entries if yoe like - for eumple, I racorded the equipeneat purchases in one journal entry and I recorded moit of the caub activity in journal echry 34. You can rocord them separately for each cash transaction if ith's eanier for you. Juat expand the spread weet and number the journal entries accortintyy. Evary joumal entry must balance between the debit and credit columins. 2. Post each joumal catry to the appeopriate "I account on the "T" Aceourt ab. Doe't forget to make sare you calculate the total balance per atcount. You will have cither a debit or a credit balance in cach "T" account after you post the transactions. I here soe inclodod any formulas to auto calculate the teesis. 3. Complete the unadjuated trial balance located on the "Trial Balence" tab by takitg the balance of each of the T accounts and entering them into the "Unadjusted Trial Baliace" debit and credit columes. If your column totals do not match, STOP. Go back asd make see you recorded and posted your journal entries correctly. 4. Rocord the adjusting entries as adjusting journal entries on the "GEEs and AJfr mb. a. Adjusting journal entres are discussed in Chapler 3 and include: 1. Dereeciation expense th. Revenue actrals iii. Expense accruals iv. Adjusting propaids (you bave at least three - inventory, supplies, and insurnce. Your copense that you are recoeding will adjuat he balasces oe the balance shest to the required balinces noted, above, at Deeember 31 ) 5. Post cach journal catry to the appeopriase "T" account on the "I" Account cak. Doe't forget to make sure you have recalculated the total balance per account. Yoe aill have either a debit or a credit bulance in each " T " wscownt affer you post the trancactions. 1 have not incloded any formelas to auto calculate the botals. 6. Review the adjusted trial balance located on the "Trial Bahnce" tab by mating suer that each adjugteneen that you recorded in 14 , above, on the worksheot is addod or siserncted from the Unadjustod trial balance total. The formalas ihould prepopulate the Adfi-sted Trial Balance, bet make sure that they are comect. You'll know that thry art cormet if (I) these totals mitch the "T" acecumt fotals after you poot the adjusties joarsal entries ap the T aceounts in step 45 , above and (2) your dobit and crodir column toeals match If thry do not match, STOP. Go back and make sure you recoeded and posted your acfurting joumal entries correctly. Every joumal enty must balance between the debit and crolir oelun:- fit. You do NOT have to turn in the analysis yet. 4 post Eeneral and adjustine journal entries for the year ended December 31.2021 . Your Part II 7. Please answer the following questions issing the financial analysis techniques and ratios that you have leamed. Please record the answers to these questions on the Word documeot template and tum it in. a. How much profit did Classic Upholstery Shop, Inc, make in its first year of business? b. Do you think it was a good idea for Tyler to open the upholstery shop or would he have been better off with his old job and why? Please isclude the financial data in your answer that belped you reach this conclusion. c. Calculate Tyler's working capital. Show your work and your answer. i. Does Tyler's working capital indicate be is managing his cash wetl? Why or why not? d. Do Tyler's assets exeeed his liabilities? Please show your work. is this an indication of a favorable or unfavorable financial situation and why? e. Is Classie Upholstery Sbop considered solvent? Why or why noc? -Classic Upbobsery Shop," Carl S. Warren, Jetterson P. Jonen, Wiltiam B. Tayler. Finuncial and Managerial Accounting, 15h Edition. Copyright, Cenpage Learning, Inc, 2020, 2018. Ient, You do NOT have to tum in the analysis yet. ad post general and adjusting joumal entries for the year ended December 31,2021 . You w CLASSIC UPHOLSTERY SHOP, INCt YOU ARE THE ACCOUNTANT Tyler Simiah had woiked ia an whbolstery ahop for 10 years, Last ycar, Tyler's wages were \$20,000. Lately. Tyler had boes unhappy with the chop's owner, Convinced thir le coold nan an upbolstery shop that did better work at a lower coet, Tyler doclated io go into burines fse henatif during 2021 and cpenel Clasic Upholstery Shop, Inc. He organirod hit business a a corponcice and depovised 590000 into a busines bank account in exchange for shares of coensos atock. To get the businesigoiog. Tyler decided to invent beavily in advetining. He spent 59.066cm athertising aimed at coesumers and anoeber 51,000 on advertising aimed at getting asth ffum interior decorakon and intenor design sores. Tyler also purchased indeatrial sewing mackisen costing $5,000 and other tools and equipment coiting $4,000. He elimated that the sewesc machines can be used fot aboet five years before maintenance conts will be toe bigh and the machines will need to be replaced. The other tools and oquipment are ted as duanbit and will have to be roplaced in three yoars. At the end of the first year of business, Tyler had received 5100,000 in cach from cuastars for hopilsery work. Tyler was owed another 55,300 from customers who are not fequind is puy eash bat are billed every 30 days. A rovicw of Tyler's checkbook shows he pald the following expenses in cash (m addition to those mentioned previously) during the first year of business: 1. Upholstery fabric 550,000 2. Ouher sqpilies invemory $10,000 3. Wager pars-time assistant 59,500 4. Rent 54,800 5. Invurance (two-year policy) $3,200 6. Utilwies 51,200 7. Professional expenses $1,700 8. Tylet's cuitiny bill foe the bas motih of the year has nof artived. He escimutes the the bil. will be approximately $320. 9. Tyler keeps seme stock of uphobwery fabrio in populur colors on hand for cectomers whe 4o not want io wait for special-order fabric io arrive. a. At the end of the year, about 514,000 of the fibric purcbiasod durits the year was in bis store slock b. In additice, \$2,300 in supplies had nok been used. tht. You do NOT have to turn in the analysis yet. post general and adjusting journal entries for the year ended Pecember 31 . 2021. Yo Denwontrate lasowledge of the accounting oyele and financial statemients t regh analysis, mreparation, and interptctstioe of accountine data Propate efcenen joumal entrits - Postegencal journal entrits (0. Prepare an vinajjusted trial balance. th Prepare afjusting joureal everies for accruals, defertals, and drpecciaticie - Post adjusting entries o. Propare an idjusted Irial bolance by pecparing a workheet. * Analyze asd utilise lenowlodgo for fitancial reportiog. in Propare financial statcmetets from ddjustod account balinces. 6. Analyre results of financial statements Steps you will take: There ure two templiates that you will use to avtrplete this assigment Claikie Upholvery Shop Tcmpletes to Tam In Fiscel Documet - Classie Upholdery Shop Finuncial Analyan Tenplace so Turn in Wond Document Betoce you begin the masignment, please change the nume of the docamenls by teplacing 7ad Tim fithe sid laat name oen bedh socumenti. For esample. I would save my filen au follows: - Cunie Uphotsiery Stwp Templakes Jentiler Coer Pieate auve therm and begis the assigrmed. Catnat. Tt. You do NOOT have to tuin in the analysis yet. post goneral ard adjusting journal entries for the year ended December 31 . 20221 . rou wo. Part1 1. Record the eksh activity ONLY as general joumal entries oo the "GItEs and AJE" tab. You can break these up into more joumal entries if yoe like - for eumple, I racorded the equipeneat purchases in one journal entry and I recorded moit of the caub activity in journal echry 34. You can rocord them separately for each cash transaction if ith's eanier for you. Juat expand the spread weet and number the journal entries accortintyy. Evary joumal entry must balance between the debit and credit columins. 2. Post each joumal catry to the appeopriate "I account on the "T" Aceourt ab. Doe't forget to make sare you calculate the total balance per atcount. You will have cither a debit or a credit balance in cach "T" account after you post the transactions. I here soe inclodod any formulas to auto calculate the teesis. 3. Complete the unadjuated trial balance located on the "Trial Balence" tab by takitg the balance of each of the T accounts and entering them into the "Unadjusted Trial Baliace" debit and credit columes. If your column totals do not match, STOP. Go back asd make see you recorded and posted your journal entries correctly. 4. Rocord the adjusting entries as adjusting journal entries on the "GEEs and AJfr mb. a. Adjusting journal entres are discussed in Chapler 3 and include: 1. Dereeciation expense th. Revenue actrals iii. Expense accruals iv. Adjusting propaids (you bave at least three - inventory, supplies, and insurnce. Your copense that you are recoeding will adjuat he balasces oe the balance shest to the required balinces noted, above, at Deeember 31 ) 5. Post cach journal catry to the appeopriase "T" account on the "I" Account cak. Doe't forget to make sure you have recalculated the total balance per account. Yoe aill have either a debit or a credit bulance in each " T " wscownt affer you post the trancactions. 1 have not incloded any formelas to auto calculate the botals. 6. Review the adjusted trial balance located on the "Trial Bahnce" tab by mating suer that each adjugteneen that you recorded in 14 , above, on the worksheot is addod or siserncted from the Unadjustod trial balance total. The formalas ihould prepopulate the Adfi-sted Trial Balance, bet make sure that they are comect. You'll know that thry art cormet if (I) these totals mitch the "T" acecumt fotals after you poot the adjusties joarsal entries ap the T aceounts in step 45 , above and (2) your dobit and crodir column toeals match If thry do not match, STOP. Go back and make sure you recoeded and posted your acfurting joumal entries correctly. Every joumal enty must balance between the debit and crolir oelun:- fit. You do NOT have to turn in the analysis yet. 4 post Eeneral and adjustine journal entries for the year ended December 31.2021 . Your Part II 7. Please answer the following questions issing the financial analysis techniques and ratios that you have leamed. Please record the answers to these questions on the Word documeot template and tum it in. a. How much profit did Classic Upholstery Shop, Inc, make in its first year of business? b. Do you think it was a good idea for Tyler to open the upholstery shop or would he have been better off with his old job and why? Please isclude the financial data in your answer that belped you reach this conclusion. c. Calculate Tyler's working capital. Show your work and your answer. i. Does Tyler's working capital indicate be is managing his cash wetl? Why or why not? d. Do Tyler's assets exeeed his liabilities? Please show your work. is this an indication of a favorable or unfavorable financial situation and why? e. Is Classie Upholstery Sbop considered solvent? Why or why noc? -Classic Upbobsery Shop," Carl S. Warren, Jetterson P. Jonen, Wiltiam B. Tayler. Finuncial and Managerial Accounting, 15h Edition. Copyright, Cenpage Learning, Inc, 2020, 2018. Ient, You do NOT have to tum in the analysis yet. ad post general and adjusting joumal entries for the year ended December 31,2021 . You w
