Assignment
Complete the following assignment and submit it to the The Accounting Worksheet Dropbox.
Part 1 of the assignment is 14 points. Part 2 is 21 points.
Part 1:
Analyze and record Mr. James’ transactions; use the General Journal form provided below. When analyzing each transaction, follow these steps:
- Decide which two accounts to use
- Classify the two accounts (what type of account are they—Asset, Liability, Capital, Revenue, Expense)
- Decide whether the accounts are increasing or decreasing
- Apply the Rules of Debit and Credit.
If possible, save or print these Rules and always keep them on your desk when analyzing transactions—you must apply these rules so that you will know if the account should be Debited or Credited:
Jan 1: Amount invested in the business by owner $10,000; cash deposited
Jan 7: Bought equipment for $500 cash, wrote Check #101
Jan 9: Bought office furniture with $2,000 cash, wrote Check #102
Jan 10: Bought materials with $2,000 cash, wrote Check #103
Jan 17: Sold part of equipment for $200
Jan 18: Bought computer on credit for $1,000 (Note: does not say cash or check written, so you are purchasing the computer on credit/on account it’s an account that is payable, so what account would you credit?)
Jan 19: Purchased office stationary for $100, wrote Check #104
Jan 25: Paid $700 cash toward computer purchased on credit, wrote Check $105 (Note: you have already Debited the Equipment account for $1000 when it was purchased on Jan. 18 on credit, now you are paying part of what you owe, so your Debit is to Accounts Payable)
Use this General Journal form to record the 8 transactions listed above (Jan 1 thru Jan 25)
Use this Chart of Accounts when deciding which accounts to use:
| 101 | Cash |
| 102 | Accounts Receivable |
| 103 | Vehicle |
| 104 | Equipment |
| 105 | Office Furniture |
| 106 | Office Supplies |
| 107 | Materials |
| 201 | Accounts Payable |
| 301 | Ross Capital |
| 401 | Sales |
| 501 | Ad Expense |
| 502 | Insurance Expense |
| 503 | Rent Expense |
| 504 | Utilities Expense |
| 505 | Supplies Expense |
Part 2:
Union Company wants to prepare a worksheet for the month of December 2011. The following information was taken from the general ledger (account balances):
| Number | Account | Amount |
| 101 | Cash | $500 |
| 102 | Accounts Receivable | $1,000 |
| 104 | Vehicle | $7,500 |
| 105 | Equipment | $2,000 |
| 201 | Accounts Payable | $1,000 |
| 301 | Ross Capital | $9,000 |
| 400 | Sales | $4,500 |
| 501 | Ad Expense | $500 |
| 502 | Insurance Expense | $500 |
| 503 | Rent Expense | $1,000 |
| 504 | Utilities Expense | $1,000 |
| 505 | Supplies Expense | $500 |
Prepare a worksheet to include the following:
- Heading—Who (name of company), What (Trial Balance), When (Date)
- Account Numbers
- Account Names
- Trial Balance—includes all of the accounts; total of debits must equal total of credits
- Income Statement—only Revenue and Expense accounts
- Balance Sheet—only Asset, Liability, and Equity accounts
- Net Income—from Total Revenue, subtract Total Expenses (type this amount on Line 19 of the worksheet form.)
IMPORTANT NOTE: Use this spreadsheet form for your worksheet ; just fill in the numbers into the correct columns - either Debit or Credit. All of the accounts appear in the Trial Balance, but only Revenue and Expense accounts are carried over to the Income Statement. Then only Asset, Liability, and Capital accounts appear in the Balance Sheet columns. (Make sure if it’s a normal Debit account, that you place it in a Debit column and if it’s a normal Credit account that you place it in a Credit column.)
Submit both parts of this assignment to the The Accounting Worksheet Dropbox. You will attach two files:
- General Journal Form (where you journalized the Jan transactions in Part 1)
- Worksheet Spreadsheet (Part 2 worksheet)
Click here to see how your assignment will be graded.