File Home Insert Draw Page Layout Formulas Data Review View Help F15 A D E H 25 Step 1 - The Chart of Accounts 26 The chart of accounts includes all of the accounts that you can use to solve your case. You may want to print 27 the chart of accounts and use it as an easy reference guide. 28 Step 11 - Journalizing the Transactions 29 Using your unique transactions record the corresponding general journal entry, rounding to two decimal places. 30 For example, 31 01 June 1: Joseph made an investment in Byte of Accounting, Inc. by purchasing 2,000 shares of its common stock for $40,000 cash. The par value of the common stock was $20 per share. 32 33 In the date field enter the date of the transaction. If you do not enter a date value an error message will appear. 34 Transaction Date Account Debit Credit + 35 Name Description 36 37 01 Jun 01 38 39 40 41 42 In the account field enter the account number that corresponds to the account in the chart of accounts. 43 You can also use the pull down list to find the appropriate account number. If you use a number that 44 is not on the chart of accounts an error message will appear 45 41 42 In the account field enter the account number that corresponds to the account in the chart of accounts 43. You can also use the pull down list to find the appropriate account number. If you use a number that 44 is not on the chart of accounts an error message will appear. 45 46 Transaction Date Name Account 47 Description Debit Credit 48 01 Jun 01 1110 Cash 49 50 51 52 53 The name of the account will automatically appear in the name column. If it is the wrong 54 account renter the correct account number 55 56 Enter the description in the description field 57 Transacion Date Account Name Description Debit Credit 01 58 59 60 61 62 63 Jun 01 1110 Cash Joseph's investment Introduction FAQ Welcome Chart of Accounts Transactions General Journal Workshi D E 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Number Name Normal Balance 1110 Cash Debit 1120 Accounts Receivable Debit 1130 Prepaid Insurance Debit 1140 Prepaid Rent Debit 1150 Office Supplies Debit 1211 Office Equip. Debit 1212 Accum. Depr.-Office Equip. Credit 1311 Computer Equip. Debit 1312 Accum. Depr.-Computer Equip Credit 1411 Building Cost Debit 1412 Accum. Depr.-Building Credit 1510 Land Debit 2101 Accounts Payable Credit 2102 Advanced Payments Credit 2103 Interest Payable Credit 2105 Salaries Payable Credit 2106 Income Taxes Payable Credit 2201 Mortgage Payable Credit 2202 Notes Payable Credit 3100 Capital Stock Credit 3200 Retained Earnings Credit 3300 Dividends Debit 3400 Income Summary Credit 4100 Computer & Consulting Reven Credit 5010 Rent Expense Debit 5020 Salary Expense Debit 5030 Advertising Expense Debit 5040 Repairs & Maint. Expense Debit 6050 Oil & Gas Expense Debit 5080 Supplies Expense Debit 5090 Interest Expense Debit 5100 Insurance Expense Debit 5110 Depreciation Expense Debit 5120 Income Tax Expense Dahit 27 28 29 30 31 32 33 64 35 1 Byte of Accounting, Inc. Tamia Camell 1760 2 3 Transaction Description of transaction 01. June 1: Byte of Accounting, Inc. acquired $42,000 in cash from Lauryn and issued 2,000 shares of its common stock 5 6 02 June 1: Byte of Accounting, Inc. issued 2,540 shares of its common stock to Tamia Camell after $22,050 in cash and computer equipment with a fair market value of $31,290 were received 7 8 03. June 1: Byte of Accounting, Inc. issued 2,022 shares of its common stock after acquiring from Courtney S30,450 in cash, computer equipment with a fair market value of $11,340 and office equipment with a fair value of $672. 9 10 04 June 2: A down payment of $30,000 in cash was made on additional computer equipment that was purchased for $150,000. A five-year note was executed by Byte for the balance. 11 12 05. 13 14 June 4: Additional office equipment costing $500 was purchased on credit from Discount Computer Corporation. 06. June 8: Unsatisfactory office equipment costing $100 was retumed to Discount Computer for credit to be applied against the outstanding balance owed by Byte. 15 16 07. June 10: Byte paid $23,000 on the balance it owed on the June 2 purchase of computer equipment 17 18 08. June 14: A one-year insurance policy covering its computer equipment was purchased by Byte for $4.968 in cash. The effective date of the policy was June 16. 19 20 14 X fix B 09. June 16: A check in the amount of $8,250 was received for consulting revenue. 10. June 16: Byte purchased a building and the land it is on for $143,000, to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $23,000. The balance of the cost is to be allocated to the building. Byte made a cash down payment of $14,300 and executed a mortgage for the balance. The mortgage is payable in eight equal annual installments beginning July 1. 11. June 17: Cash of $7,200 was paid for rent for June, July, August and September. Put the total amount into the Prepaid Rent account. 12. June 17: Received a bill of $450 from the local newspaper for advertising. 13. June 21: Accounts payable in the amount of $400 were paid. 14. June 21: A fax machine for the office was purchased for $875 cash. 15. June 21: Billed various miscellaneous local customers $4,800 for consulting services performed 3 5 16. June 22: Paid salaries of $910 to equipment operators for the week ending June 18. 17. June 22: Received a bill for $1,090 from Computer Parts and Repair Co. for repairs to the computer equipment. 7 8 9 18 June 22: Paid the advertising bill that was received on June 17 0 19 June 23: Purchased office supplies for S555 on credit. Record the purchase as an increase to the assets. 5205 20. June 23: Cash in the amount of $3,845 was received on billings. 21. June 28: Billed $6,015 to miscellaneous customers for services performed to June 25. 22. June 29: Paid the bill received on June 22, from Computer Parts and Repairs Co. 23. June 29: Cash in the amount of $5,699 was received for billings. 24. June 29: Paid salaries of $910 to equipment operators for the week ending June 25. 25. June 30: Received a bill for the amount of $965 from O&G Oil and Gas Co. 26. June 30: Paid a cash dividend of $0.22 per share to the three shareholders of Byte. IMPORTANT NOTE: The number of shares of capital stock outstanding can be determined from the first three transactions.] Adjusting Entries - Round to two decimal places. 27. The rent payment made on June 17 was for June, July, August and September. Expense the amount associated with one month's rent. 28. A physical inventory showed that only $225.00 worth of office supplies remained on hand as of June 30. 29 The annual interest rate on the mortgage payable was 8.25 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. 30. Information relating to the prepaid insurance may be obtained from the transaction recorded on June 14. Expense the amount associated with one half month's insurance, B 30. Information relating to the prepaid insurance may be obtained from the transaction recorded on June 14. Expense the amount associated with one half month's insurance. 5. 6 31. A review of Byte's job worksheets show that there are unbilled revenues in the amount of $5,750 for the period of June 28-30. 7 7 3 3 32 The fixed assets have estimated useful lives as follows: Building - 31.5 years Computer Equipment - 5.0 years Office Equipment - 7.0 years Use the straight-line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building's scrap value is $8,500. The office equipment has a scrap value of $300. The computer equipment has no scrap value. Calculate the depreciation for one month. 33. A review of the payroll records show that unpaid salaries in the amount of $546.00 are owed by Byte for three days, June 28 - 30. 34. The note payable relating to the June 2, and 10 transactions is a five-year note, with interest at the rate of 12 percent annually. Interest expense should be computed based [IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $120,000. On June 10, eight days later, $23,000 was repaid. Interest expense must calculated on the $120,000 for eight days. In addition, interest expense on the $97,000 balance of the loan (S120,000 less $23,000 = $97.000) must be calculated for the 20 days remaining in the month of June. 35. Income taxes are to be computed at the rate of 25 percent of net income before taxes. [IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tax line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.] 78 [IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $120,000. On June 10, eight days later, $23,000 was repaid. Interest expense must calculated on the $120,000 for eight days. In addition, interest expense on the $97,000 balance of the loan ($120,000 less $23,000 = $97,000) must be calculated for the 20 days remaining in the month of June. 79 80 81 35. Income taxes are to be computed at the rate of 25 percent of net income before taxes. [IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tax line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.] 82 83 84 Closing Entries 85 86 36. Close the revenue accounts. 87 B8 37. Close the expense accounts. 89 90 38. Close the income summary account. 91 39. Close the dividends account, 92 93 94 A Byte of Accounting, Inc. General Journal Note: You can only enter data into the yellow filled cells. Transaction Account Date Name Description Debit Credit 01 02 03 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 04 05 Transaction Account Date Name Description Debit Credit 06 07 08 09 10 General Journal Note: You can only enter data into the yellow filled cells. Transaction Credit Date Name Account Description Debit 37 38 39 Unadjusted Trial Balance Debit Credit Adjusting Entries Debit Credit Adjusted Trial Balance Debit Credit Account Number Name 1110 Cash 1120 Accounts Receivable 1130 Prepaid Insurance 1140 Prepaid Rent 1150 Office Supplies 1211 Office Equip 1212 Accum. Depr.-Office Equip 1311 Computer Equip 1312 Accum. Depr.-Computer Equip 1411 Building Cost 1412 Accum. Depr.-Building 1510 Land 2101 Accounts Payable 2102 Advanced Payments 2103 Interest Payable 2105 Salaries Payable 2106 Income Taxes Payable 2201 Mortgage Payable 2202 Notes Payable 3100 Capital Stock 3200 Retained Earnings 3300 Dividends ennt 4100 Computer & Consulting Revenue Transactions General Journal Worksheet Income Statement Changes in Retained Earnings D12 X D E F H A B 2103 Interest Payable 2105 Salaries Payable 2106 Income Taxes Payable 2201 Mortgage Payable 2202 Notes Payable 3100 Capital Stock 3200 Retained Earnings 3300 Dividends 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 61 52 53 4100 Computer & Consulting Revenue 5010 Rent Expense 5020 Salary Expense 5030 Advertising Expense 5040 Repairs & Maint. Expense 5050 Oil & Gas Expense 5080 Supplies Expense 5090 Interest Expense 5100 Insurance Expense 5110 Depreciation Expense 5120 Income Tax Expense TOTAL A Byte of Accounting, Inc. Income Statement For Month Ending January 0, 1900 Revenues Computer & Consulting Revenue Expenses Rent Expense Salary Expense Advertising Expense Repairs & Maint. Expense Oil & Gas Expense Supplies Expense Interest Expense Insurance Expense Depreciation Expense Total Expenses Net Income Before Tax Income Tax Expense (Round to two decimal places) 100) Net Income After Tax A Byte of Accounting, Inc. Statement of Changes in Retained Earnings For Month Ending January 0, 1900 Total Balance, Beginning of Period Net Income Dividends Balance, End of Period A Byte of Accounting, Inc. Balance Sheet As of January 0, 1900 Assets Current Assets Cash Accounts Receivable Prepaid Insurance Prepaid Rent Office Supplies Total Long-Term Assets Office Equip Accum. Depr.-Office Equip. Computer Equip Accum. Depr.-Computer Equip Building Cost Accum. Depr. -Building Land Total Total Assets Liabilities Accum. Depr.-Building Land Total Total Assets Liabilities Current Liabilities Accounts Payable Advanced Payment Interest Payable Salaries Payable Income Taxes Payable Total Long-Term Liabilities Mortgage Payable Notes Payable Total Total Liabilities Stockholder's Equity Capital Stock Retained Earnings Total Total Liabilities and Stockholder's Equity . Income Statement File Home Insert Draw Page Layout Formulas Data Review View Help F15 A D E H 25 Step 1 - The Chart of Accounts 26 The chart of accounts includes all of the accounts that you can use to solve your case. You may want to print 27 the chart of accounts and use it as an easy reference guide. 28 Step 11 - Journalizing the Transactions 29 Using your unique transactions record the corresponding general journal entry, rounding to two decimal places. 30 For example, 31 01 June 1: Joseph made an investment in Byte of Accounting, Inc. by purchasing 2,000 shares of its common stock for $40,000 cash. The par value of the common stock was $20 per share. 32 33 In the date field enter the date of the transaction. If you do not enter a date value an error message will appear. 34 Transaction Date Account Debit Credit + 35 Name Description 36 37 01 Jun 01 38 39 40 41 42 In the account field enter the account number that corresponds to the account in the chart of accounts. 43 You can also use the pull down list to find the appropriate account number. If you use a number that 44 is not on the chart of accounts an error message will appear 45 41 42 In the account field enter the account number that corresponds to the account in the chart of accounts 43. You can also use the pull down list to find the appropriate account number. If you use a number that 44 is not on the chart of accounts an error message will appear. 45 46 Transaction Date Name Account 47 Description Debit Credit 48 01 Jun 01 1110 Cash 49 50 51 52 53 The name of the account will automatically appear in the name column. If it is the wrong 54 account renter the correct account number 55 56 Enter the description in the description field 57 Transacion Date Account Name Description Debit Credit 01 58 59 60 61 62 63 Jun 01 1110 Cash Joseph's investment Introduction FAQ Welcome Chart of Accounts Transactions General Journal Workshi D E 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Number Name Normal Balance 1110 Cash Debit 1120 Accounts Receivable Debit 1130 Prepaid Insurance Debit 1140 Prepaid Rent Debit 1150 Office Supplies Debit 1211 Office Equip. Debit 1212 Accum. Depr.-Office Equip. Credit 1311 Computer Equip. Debit 1312 Accum. Depr.-Computer Equip Credit 1411 Building Cost Debit 1412 Accum. Depr.-Building Credit 1510 Land Debit 2101 Accounts Payable Credit 2102 Advanced Payments Credit 2103 Interest Payable Credit 2105 Salaries Payable Credit 2106 Income Taxes Payable Credit 2201 Mortgage Payable Credit 2202 Notes Payable Credit 3100 Capital Stock Credit 3200 Retained Earnings Credit 3300 Dividends Debit 3400 Income Summary Credit 4100 Computer & Consulting Reven Credit 5010 Rent Expense Debit 5020 Salary Expense Debit 5030 Advertising Expense Debit 5040 Repairs & Maint. Expense Debit 6050 Oil & Gas Expense Debit 5080 Supplies Expense Debit 5090 Interest Expense Debit 5100 Insurance Expense Debit 5110 Depreciation Expense Debit 5120 Income Tax Expense Dahit 27 28 29 30 31 32 33 64 35 1 Byte of Accounting, Inc. Tamia Camell 1760 2 3 Transaction Description of transaction 01. June 1: Byte of Accounting, Inc. acquired $42,000 in cash from Lauryn and issued 2,000 shares of its common stock 5 6 02 June 1: Byte of Accounting, Inc. issued 2,540 shares of its common stock to Tamia Camell after $22,050 in cash and computer equipment with a fair market value of $31,290 were received 7 8 03. June 1: Byte of Accounting, Inc. issued 2,022 shares of its common stock after acquiring from Courtney S30,450 in cash, computer equipment with a fair market value of $11,340 and office equipment with a fair value of $672. 9 10 04 June 2: A down payment of $30,000 in cash was made on additional computer equipment that was purchased for $150,000. A five-year note was executed by Byte for the balance. 11 12 05. 13 14 June 4: Additional office equipment costing $500 was purchased on credit from Discount Computer Corporation. 06. June 8: Unsatisfactory office equipment costing $100 was retumed to Discount Computer for credit to be applied against the outstanding balance owed by Byte. 15 16 07. June 10: Byte paid $23,000 on the balance it owed on the June 2 purchase of computer equipment 17 18 08. June 14: A one-year insurance policy covering its computer equipment was purchased by Byte for $4.968 in cash. The effective date of the policy was June 16. 19 20 14 X fix B 09. June 16: A check in the amount of $8,250 was received for consulting revenue. 10. June 16: Byte purchased a building and the land it is on for $143,000, to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $23,000. The balance of the cost is to be allocated to the building. Byte made a cash down payment of $14,300 and executed a mortgage for the balance. The mortgage is payable in eight equal annual installments beginning July 1. 11. June 17: Cash of $7,200 was paid for rent for June, July, August and September. Put the total amount into the Prepaid Rent account. 12. June 17: Received a bill of $450 from the local newspaper for advertising. 13. June 21: Accounts payable in the amount of $400 were paid. 14. June 21: A fax machine for the office was purchased for $875 cash. 15. June 21: Billed various miscellaneous local customers $4,800 for consulting services performed 3 5 16. June 22: Paid salaries of $910 to equipment operators for the week ending June 18. 17. June 22: Received a bill for $1,090 from Computer Parts and Repair Co. for repairs to the computer equipment. 7 8 9 18 June 22: Paid the advertising bill that was received on June 17 0 19 June 23: Purchased office supplies for S555 on credit. Record the purchase as an increase to the assets. 5205 20. June 23: Cash in the amount of $3,845 was received on billings. 21. June 28: Billed $6,015 to miscellaneous customers for services performed to June 25. 22. June 29: Paid the bill received on June 22, from Computer Parts and Repairs Co. 23. June 29: Cash in the amount of $5,699 was received for billings. 24. June 29: Paid salaries of $910 to equipment operators for the week ending June 25. 25. June 30: Received a bill for the amount of $965 from O&G Oil and Gas Co. 26. June 30: Paid a cash dividend of $0.22 per share to the three shareholders of Byte. IMPORTANT NOTE: The number of shares of capital stock outstanding can be determined from the first three transactions.] Adjusting Entries - Round to two decimal places. 27. The rent payment made on June 17 was for June, July, August and September. Expense the amount associated with one month's rent. 28. A physical inventory showed that only $225.00 worth of office supplies remained on hand as of June 30. 29 The annual interest rate on the mortgage payable was 8.25 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16. 30. Information relating to the prepaid insurance may be obtained from the transaction recorded on June 14. Expense the amount associated with one half month's insurance, B 30. Information relating to the prepaid insurance may be obtained from the transaction recorded on June 14. Expense the amount associated with one half month's insurance. 5. 6 31. A review of Byte's job worksheets show that there are unbilled revenues in the amount of $5,750 for the period of June 28-30. 7 7 3 3 32 The fixed assets have estimated useful lives as follows: Building - 31.5 years Computer Equipment - 5.0 years Office Equipment - 7.0 years Use the straight-line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building's scrap value is $8,500. The office equipment has a scrap value of $300. The computer equipment has no scrap value. Calculate the depreciation for one month. 33. A review of the payroll records show that unpaid salaries in the amount of $546.00 are owed by Byte for three days, June 28 - 30. 34. The note payable relating to the June 2, and 10 transactions is a five-year note, with interest at the rate of 12 percent annually. Interest expense should be computed based [IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $120,000. On June 10, eight days later, $23,000 was repaid. Interest expense must calculated on the $120,000 for eight days. In addition, interest expense on the $97,000 balance of the loan (S120,000 less $23,000 = $97.000) must be calculated for the 20 days remaining in the month of June. 35. Income taxes are to be computed at the rate of 25 percent of net income before taxes. [IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tax line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.] 78 [IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $120,000. On June 10, eight days later, $23,000 was repaid. Interest expense must calculated on the $120,000 for eight days. In addition, interest expense on the $97,000 balance of the loan ($120,000 less $23,000 = $97,000) must be calculated for the 20 days remaining in the month of June. 79 80 81 35. Income taxes are to be computed at the rate of 25 percent of net income before taxes. [IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tax line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.] 82 83 84 Closing Entries 85 86 36. Close the revenue accounts. 87 B8 37. Close the expense accounts. 89 90 38. Close the income summary account. 91 39. Close the dividends account, 92 93 94 A Byte of Accounting, Inc. General Journal Note: You can only enter data into the yellow filled cells. Transaction Account Date Name Description Debit Credit 01 02 03 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 04 05 Transaction Account Date Name Description Debit Credit 06 07 08 09 10 General Journal Note: You can only enter data into the yellow filled cells. Transaction Credit Date Name Account Description Debit 37 38 39 Unadjusted Trial Balance Debit Credit Adjusting Entries Debit Credit Adjusted Trial Balance Debit Credit Account Number Name 1110 Cash 1120 Accounts Receivable 1130 Prepaid Insurance 1140 Prepaid Rent 1150 Office Supplies 1211 Office Equip 1212 Accum. Depr.-Office Equip 1311 Computer Equip 1312 Accum. Depr.-Computer Equip 1411 Building Cost 1412 Accum. Depr.-Building 1510 Land 2101 Accounts Payable 2102 Advanced Payments 2103 Interest Payable 2105 Salaries Payable 2106 Income Taxes Payable 2201 Mortgage Payable 2202 Notes Payable 3100 Capital Stock 3200 Retained Earnings 3300 Dividends ennt 4100 Computer & Consulting Revenue Transactions General Journal Worksheet Income Statement Changes in Retained Earnings D12 X D E F H A B 2103 Interest Payable 2105 Salaries Payable 2106 Income Taxes Payable 2201 Mortgage Payable 2202 Notes Payable 3100 Capital Stock 3200 Retained Earnings 3300 Dividends 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 61 52 53 4100 Computer & Consulting Revenue 5010 Rent Expense 5020 Salary Expense 5030 Advertising Expense 5040 Repairs & Maint. Expense 5050 Oil & Gas Expense 5080 Supplies Expense 5090 Interest Expense 5100 Insurance Expense 5110 Depreciation Expense 5120 Income Tax Expense TOTAL A Byte of Accounting, Inc. Income Statement For Month Ending January 0, 1900 Revenues Computer & Consulting Revenue Expenses Rent Expense Salary Expense Advertising Expense Repairs & Maint. Expense Oil & Gas Expense Supplies Expense Interest Expense Insurance Expense Depreciation Expense Total Expenses Net Income Before Tax Income Tax Expense (Round to two decimal places) 100) Net Income After Tax A Byte of Accounting, Inc. Statement of Changes in Retained Earnings For Month Ending January 0, 1900 Total Balance, Beginning of Period Net Income Dividends Balance, End of Period A Byte of Accounting, Inc. Balance Sheet As of January 0, 1900 Assets Current Assets Cash Accounts Receivable Prepaid Insurance Prepaid Rent Office Supplies Total Long-Term Assets Office Equip Accum. Depr.-Office Equip. Computer Equip Accum. Depr.-Computer Equip Building Cost Accum. Depr. -Building Land Total Total Assets Liabilities Accum. Depr.-Building Land Total Total Assets Liabilities Current Liabilities Accounts Payable Advanced Payment Interest Payable Salaries Payable Income Taxes Payable Total Long-Term Liabilities Mortgage Payable Notes Payable Total Total Liabilities Stockholder's Equity Capital Stock Retained Earnings Total Total Liabilities and Stockholder's Equity . Income Statement