Step 1 Download the Data

Download the Excel spreadsheet from my website and on Canvas. You will need a USB/flash drive on which to save your data. You will need to print the transactions/instructions and save the Excel file, which contains all the forms needed (except the journal) to complete the project. Print the instructions and transactions and SAVE the Excel file to your USB. You will complete the project using the Excel file so you will need to save your data on your USB.

The forms you need have been set up in Excel and are labeled along the bottom left of the screen in the sheet tabs. You will need to customize your worksheet by giving your group a unique name and entering the group name in cell to the right of the Name cell on each sheet. Follow the directions carefully to complete the project.

Step 2 - Journalize the transactions

Record the transactions for Sharpe Inc. in the general journal. There is no journal form provided, you will need to use your own journal forms or print some from my website. You must use a journal form to record the transactions and your journal entries must be hand written. Do not record the adjusting entries just yet, only the transactions through December 31, 2020.

Use only the accounts provided. Please refer to the chart of accounts in the Excel file you saved from my website for a list of accounts. Round all amount to the nearest whole dollar.

Step 3 - Post the transactions to the T-accounts

Post your journal entries to the T-Accounts in the Excel worksheet you saved from my website. The amounts already in the T-Accounts are the beginning balances and should be included in your balances. You do not need to use a posting reference. Do not add any new accounts, all the accounts you need have already been set up. The account balance will update with each posting. Do not do the adjustments yet!

When posting the transactions to the T-accounts, start in the top cell of each T-account for both debits and credits and do not skip any lines.

Step 4 - Prepare a Trial Balance

Click on the Trial Balance tab and prepare the Trial Balance. The total of the Trial Balance should be $4,346,028. If your balance does not agree, make any necessary corrections before you proceed.

Step 5 - Prepare Adjusting Entries

Record the adjusting entries in the journal after the journal entries you recorded in step #2. Skip a line after the last entry and write Adjusting Entries in the middle of the account column then journalize the adjusting entries. You do not need an explanation, but skip a line between entries. All the adjusting entries should be dated December 31. Post the adjusting entries to the T-Accounts in Excel.

Step 6 - Prepare an Adjusted Trial Balance

Click on the Adjusted Trial Balance tab and prepare the Adjusted Trial Balance. The total of the Adjusted Trial Balance should be $4,383,321. If your balance does not agree, make any necessary corrections before you proceed.

Step 7 - Prepare the Income Statement

Click on the Income Statement tab in the Excel file to prepare the Income Statement using the amounts from the Adjusted Trial Balance. The Income Statement has been formatted using the outlined cells. Entries should only be made in the outlined cells. The exact number of rows needed are outlined so you should not add any rows or columns to the Income Statement. Net Income should be $672,951.

Step 8 Prepare a Retained Earnings Statement and Balance Sheet

Prepare the Retained Earnings Statement and the Balance Sheet the same way you did the Income Statement using the amounts from the Adjusted Trial Balance. Both statements have been formatted with the exact number of rows needed. Entries should only be made in the outlined cells; do not add any rows or columns. Total Assets should be $2,973,019.

Turn in the following items (stapled in the order listed below):

• Cover Sheet (include each group members name)
• Journal Entries
• T-Accounts
• Trial Balance
• Adjusted Trial Balance
• Income Statement
• Retained Earnings Statement
• Balance Sheet

ACCT 101 Fundamentals of Accounting

Dinah Soars, Biff Wellington and Duane Pipe are the stockholders of Sharpe Incorporated. The charter of the corporation authorized 500,000 shares of $2 par common stock, and 100,000 shares of $30 par, 4%, preferred stock. As of January 1, 2020, there were 24,000 shares of common stock issued and outstanding and 5,000 shares of preferred stock issued and outstanding.

Selected transactions completed by Sharpe Incorporated during the fiscal year-ending December 31, 2020, are as follows:

Jan 1 Issued 12,500 shares of $2 par common stock at $22, receiving cash.

Jan 1 Issued 5,800 shares of $30 par, 4%, preferred stock at $70 for cash.

Feb 1 Purchased equipment for $195,000, paying $15,000 cash and financing the remainder with a 180-day, 6% note payable.

Mar 15 Purchased land for $352,000 by issuing 20,000 shares of common stock.

Mar 31 Purchased a two-year insurance policy for $36,600.

May 1 Purchased 1,750 shares of the companys own common stock at $22 per share.

May 31 Issued $1,000,000 of 8-year, 7% bonds with interest payable semiannually. The amount of cash received was $926,896.

July 30 Paid the amount due on the note payable signed on February 1.

Aug 1 Sold 430 shares of treasury common stock purchased on May 1 for $25 per share.

Sept 15 Declared a 2% stock dividend on common stock to be distributed on September 30 to stockholders of record on September 20. The market price per share on September 15 is $25 per share.

Sept 30 Distributed the stock dividend declared September 15.

Oct 1 Borrowed $40,000 from Second Bank by issuing an 7% note. The note is to be repaid in quarterly payments of principal plus interest totaling $1,860 per quarter.

Oct 16 Sold 370 shares of treasury common stock purchased on May 1 for $18 per share.

Nov 30 Paid the semiannual interest and amortized the premium on the bonds issued on May 31.

Dec 1 Declared a cash dividend at the stated amount to preferred stockholders and .40 per share to common stockholders payable on December 30 to stockholders of record on December 16.

(Hint: dont forget the shares distributed from the stock dividend)

Dec 30 Paid the cash dividends declared on December 1.

Dec 31 Paid the first quarterly installment of the note issued on October 1.

Dec 31 Record revenue for the year of $1,975,000, received $500,000 in cash, the remainder is on account.

Dec 31 Record expenses for the year, paid in cash (one compound entry):

Rent $170,000

Utilities 13,200

Salaries 760,000

Advertising 140,000

Medical insurance 32,000

Commissions 63,000

Legal and accounting 18,000

Miscellaneous 8,400

Adjusting Entries

(1) The employees accrued vacation pay at the end of the year was $11,880.

(2) Record depreciation on the equipment purchased on February 1, using the straight-line method. The equipment has an estimated 9-year useful life and an estimated residual value of $2,760.

(3) Record insurance expired on the policy purchased March 31.

(4) Record the adjusting entry for the interest accrued and the amortization of the premium on the bonds payable since the last interest payment. (round the amount to the nearest dollar)