During its first month of operation, the Bethany’s Bicycle Corporation, which specializes in bicycle repairs, completed the following transactions. March Transactions DateTransaction Description March 1Began business by making a deposit in a company bank account of $20,000, in exchange for 2,000 shares of $10 par value common stock. March 1Paid the premium on a 1-year insurance policy, $2,400. March 1Paid the current month’s store rent expense, $1,900. March 3Purchased repair equipment from Andrew Company, $5,800. Paid $1,000 down and the balance was placed on account. Payments will be $400.00 per month for 12 months. The first payment is due 4/1. Note: Use Accounts Payable for the Balance Due. March 8Purchased repair supplies from Jackson Company on credit, $650. March 10Paid telephone bill for March, $340. March 11Cash bicycle repair revenue for the first third of March, $1,650. March 18Made payment to Jackson Company, $400. March 20Cash bicycle repair revenue for the second third of March, $2,450. March 31Cash bicycle repair revenue for the last third of March, $1,250. March 31Paid the current month’s electice bill, $250. March 31Declared and paid cash dividend of $1,000.
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| ACCT 212: Course Project | ||
| Requirement | Requirement Description | Worksheet Name |
| 1 | Prepare the Journal Entries in the General Journal | 1 – Journal Entries |
| 2 | Post Journal Entries to the General Ledger | 2 – General Ledger |
| 3 | Prepare a Trial Balance | 3 – Trial Balance |
| 4 | Prepare the Adjusting Entries | 4 – Adjusting Entries |
| 5 | Post Adjusting Entries to the General Ledger | 2 – General Ledger |
| 6 | Prepare an Adjusted Trial Balance | 5 – Adjusted TB |
| 7 | Prepare the Financial Statements | 6 – Financial Statements |
| 8 | Prepare the Closing Entries | 7 – Closing Entries |
| 9 | Post Closing Entries to the General Ledger | 2 – General Ledger |
| 10 | Prepare the Post Closing Trial Balance | 8 – Post Closing Trial Balance |
Project Instructions
| Course Project Overview |
| The Course Project consists of 10 Requirements for you to complete. The Course Project is due at the end of Week 6. See the Syllabus section ”Due Dates for Assignments & Exams” for due date information. All of the information you need to complete the Course Project is located in this Workbook. • There are eight worksheets in the workbook you will need to complete. • A list of March transactions • A Chart of Accounts reference sheet • A Grading Rubric to help explain what is expected. • Each worksheet has the Check Figures embedded as a comment. |
| Scenario |
| You’ve just secured a new client in your accounting practice, Bethany’s Bicycle Corporation (BBC), a brand new small business specializing in bicycle repair. The owner, Bethany Beck, is a terrific cyclist and bike repair specialist, but definitely not an accountant. Your job is to helpBethany put his affairs in order. Luckily Bethany has only been in operation for a month and things have not gotten too out of hand yet! Bethany has to submit his financial statements to her investors and doesn’t know where to begin. It’s your job to go through the complete Accounting cycle to prepare the financial statements for the BBC. |
| Requirements |
| Guidelines |
| Use the embedded assistance in the template, guidance in your textbook, and examples in the weekly lectures to complete this project. Should you have any questions contact your professor. |
Before You Begin: Review the Week 2 Lecture prior to starting work on this project. Print the Chart of Accounts and October Transactions worksheets for your reference. You will need to refer to both throughout the project. Review the Grading Criteria. SAVE your work frequently in this workbook.
March Transactions
| During its first month of operation, the Bethany’s Bicycle Corporation, which specializes in bicycle repairs, completed the following transactions. | |
| March Transactions | |
| Date | Transaction Description |
| March 1 | Began business by making a deposit in a company bank account of $20,000, in exchange for 2,000 shares of $10 par value common stock. |
| March 1 | Paid the premium on a 1-year insurance policy, $2,400. |
| March 1 | Paid the current month’s store rent expense, $1,900. |
| March 3 | Purchased repair equipment from Andrew Company, $5,800. Paid $1,000 down and the balance was placed on account. Payments will be $400.00 per month for 12 months. The first payment is due 4/1. Note: Use Accounts Payable for the Balance Due. |
| March 8 | Purchased repair supplies from Jackson Company on credit, $650. |
| March 10 | Paid telephone bill for March, $340. |
| March 11 | Cash bicycle repair revenue for the first third of March, $1,650. |
| March 18 | Made payment to Jackson Company, $400. |
| March 20 | Cash bicycle repair revenue for the second third of March, $2,450. |
| March 31 | Cash bicycle repair revenue for the last third of March, $1,250. |
| March 31 | Paid the current month’s electice bill, $250. |
| March 31 | Declared and paid cash dividend of $1,000. |
Chart of Accounts
| Use the following account descriptions for journal entries. | |||
| Chart of Accounts | |||
| Account Type | Account Number | Account Title | Normal Balance |
| Assets | |||
| 111 | Cash | Debit | |
| 117 | Prepaid Insurance | Debit | |
| 119 | Repair Supplies | Debit | |
| 144 | Repair Equipment | Debit | |
| 145 | Accum Dep -Repair Equipment | Credit | |
| Liabilities | |||
| 212 | Accounts Payable | Credit | |
| 213 | Income Tax Payable | Credit | |
| Stockholders Equity | |||
| 311 | Common Stock | Credit | |
| 312 | Retained Earnings | Credit | |
| 313 | Dividends | Debit | |
| Revenue | |||
| 411 | Bicycle Repair Revenue | Credit | |
| Expenses | |||
| 511 | Store Rent Expense | Debit | |
| 512 | Telephone Expense | Debit | |
| 513 | Insurance Expense | Debit | |
| 514 | Repair Supplies Expense | Debit | |
| 515 | Dep Expense – Repair Equipment | Debit | |
| 516 | Income Tax Expense | Debit | |
| 517 | Electric Expense | Debit |
1 – Journal Entries
| REQUIREMENT #1: Prepare journal entries to record the March transactions in the General Journal below. Remember that Debits must equal Credits—All of your Journal Entries should balance. | ||||
| General Journal | ||||
| Date | Account Number from Chart of Accounts tab | Account Title from Chart of Accounts tab | Debit | Credit |
| 0 Harris, Nicole: Debits = $38,090 |
– 0 Harris, Nicole: Credits = $38,090 |
Journal Entries
Once you’ve completed this requirement print your General Journal to complete Requirement #2 on the General Ledger worksheet.
2 – General Ledger
| REQUIREMENT #2: Post the March journal entries to the following T-Accounts and compute ending balances. | |||
| Date | Cash (111) DeVry: The balance of the Cash account after posting journal entries for Part A should be $18,060 . |
Date | Bicycle Repair Revenue (411) |
| Prepaid Insurance (117) | Store Rent Expense (511) | ||
| Repair Supplies (119) | Telephone Expense (512) | ||
| Repair Equipment (144) | Insurance Expense (513) | ||
| Accum. Depr.-Repair Equipment (145) | Repair Supplies Expense (514) | ||
| Accounts Payable (212) | Depr. Exp.-Repair Equipment (515) | ||
| Income Taxes Payable (213) | Income Taxes Expense (516) | ||
| Common Stock (311) | Electric Expense (517) | ||
| Retained Earnings (312) | |||
| Dividends (313) |
This worksheet will be used to complete Requirements #2, #5 and #9. Instructions for #5 can be found on the Adjusting Entries Worksheet. Instructions for #9 can be found on the Closing Entries Worksheet.
3 – Trial Balance
| REQUIREMENT #3: Prepare a trial balance for March in the space below. | |||
| Bethany’s Bicycle Corporation Trial Balance March 31 | |||
| Account | Account | Balance | |
| Number | Title | Debit | Credit |
| 0 User: Debit Balance = $30,400 |
0 User: Credit Balance = $30,400 |
Journal Entries
Only enter accounts that have a balance.
4 – Adjusting Entries
| Requirement #4: Prepare adjusting entries using the following information in the General Journal below. Show your calculations! a) One month’s insurance has expired. b) The remaining inventory of repair supplies is $200. c) The estimated depreciation on repair equipment is $120. d) The estimated income taxes are $65. | ||||
| Requirement #5: Post the adjusting entries on March 31 below to the General Ledger T-accounts and compute adjusted balances. Just add to the balances that are already listed. | ||||
| General Journal | ||||
| Date | Account Number from Chart of Accounts tab | Account Title from Chart of Accounts tab | Debit | Credit |
| 0 Bruce: Balance $406.00 |
0 Bruce: Balance $406.00 |
Journal Entries
5 – Adjusted TB
| REQUIREMENT #6: Prepare an Adjusted Trial Balance in the space below. | |||
| Bethany’s BicycleCorporation Adjusted Trial Balance March 31 | |||
| Account | Account | Balance | |
| Number | Title | Debit | Credit |
| 0 User: Debit Balance = $30,585 |
0 User: Credit Balance = $30,585 |
Journal Entries
Only enter accounts that have a balance.
6 – Financial Statements
| Requirement #7: Prepare the financial statements for Bethany’s Bicycle Corporation as of March 31 in the space below. You will only be preparing the Income Statement, Statement of Retained Earning, and the Balance Sheet. The Statement of Cash Flows is a required Financial Statement, but is not required for this project. | ||||
| Bethany’s Bicycle Corporation | Bethany’s Bicycle Corporation | Bethany’s Bicycle Corporation | ||
| Income Statement | Statement of Retained Earnings | Balance Sheet | ||
| For the Month Ending March 31 | For the Month Ending March 31 | March 31 | ||
| Revenues: | Retained Earnings, March 1 | $0 | Assets: | |
| Bicycle Repair Revenue | Add: Net Income | Cash | ||
| Total Revenue | 0 | Subtotal | 0 | Prepaid Insurance |
| Less: Dividends | Repair Supplies | |||
| Expenses: | Retained Earnings, March 31 | $0 User: Retained Earnings = $1,025 |
Repair Equipment | |
| Store Rent Expense | Less: Accum. Depr. | |||
| Telephone Expense | Total Assets | $0 User: $26,140 |
||
| Insurance Expense | ||||
| Repair Supplies Exp. | Liabilities and Stockholders’ Equity | |||
| Depreciation Exp. | Liabilities: | |||
| Income Taxes Expense | Accounts Payable | |||
| Electric Expense | Income Taxes Payable | |||
| Total Expenses | 0 | Total Liabilities | 0 | |
| Net Income | 0 User: Net Income = $2,025 |
Stockholders’ Equity: | ||
| Common Stock | ||||
| Retained Earnings | ||||
| Total Stockholders’ Equity | 0 | |||
| Total Liabilities & Stockholders’ Equity | $0 User: $26,140 |
7 – Closing Entries
| Requirement #8: Prepare the closing entries at March 31 in the General Journal below. Hint:Use the balances for each account which appear on the Adjusted Trial Balance for your closing entries. | ||||
| Requirement #9: Post the closing entries to the T-Accounts on the General Ledger worksheet and compute ending balances. Just add to the adjusted balances already listed. | ||||
| General Journal | ||||
| Date | Account Number from Chart of Accounts tab | Account Title from Chart of Accounts tab | Debit | Credit |
| 0 Bruce: Debit $9,675 |
0 Bruce: Credit $9,675 |
Journal Entries
See the Week 2 Lecture for examples of how to complete closing entries.
8 – Post Closing Trial Balance
| Requirement #10: Prepare a post-closing trial balance as of March 31 in the space below. | |||
| Bethany’s Bicycle Corporation Post-Closing Trial Balance March 31 | |||
| Account | Account | Balance | |
| Number | Title | Debit | Credit |
| – 0 User: Debits = $26,260 |
– 0 User: Credits = 26,260 |
Journal Entries
Grading Rubric
| Project 1 Grading Rubric – Students | ||||
| Criteria | Excellent | Good | Poor | Very Poor |
| Parts: | 90% to 100% | 70% to 89% | 50% to 69% | Less than 50% |
| Step 1 —Journal Entries (20 points) | Journal entries use accurate accounts and amounts; and debits and credits are used correctly. | Journal entries mostly use accurate accounts and amounts; and debits and credits are used correctly. | Journal entries have some errors in use of accounts and amounts; and debits and credits are only somewhat used correctly. | Journal entries have some errors in use of accounts and amounts; and debits and credits are not used correctly. |
| Steps 2 and 3 —Posted and Unadjusted Trial Balance. (10 points) | Posting is correct leading to an accurate trial balance. | Posting is mostly correct leading to a mostly correct trial balance. | Posting has several errors leading to a trial balance with several errors. | Posting is done poorly or not at all, leading to inaccurate or no trial balance. |
| Step 4 —Adjusting Journal Entries (10 points) | Journal entries use accurate accounts and amounts; and debits and credits are used correctly. | Journal entries mostly use accurate accounts and amounts; and debits and credits are used correctly. | Journal entries have some errors in use of accounts and amounts; and debits and credits are only somewhat used correctly. | Journal entries have some errors in use of accounts and amounts; and debits and credits are not used correctly. |
| Steps 5 and 6 —Posted and Adjusted Trial Balance. (10 points) | Posting is correct leading to an accurate trial balance. | Posting is mostly correct leading to a mostly correct trial balance. | Posting has several errors leading to a trial balance with several errors. | Posting is done poorly or not at all, leading to inaccurate or no trial balance. |
| Step 7 —Financial Statements (10 points) | All four financial statements are prepared accurately and in an appropriate format. | Three of four financial statements are prepared accurately and mostly in an appropriate format, one statement has some errors. | Two of four financial statements are prepared accurately and mostly in an appropriate format, two statements have some errors. | One or fewer of four financial statements are prepared accurately and mostly in an appropriate format, three or all statements have some errors. |
| Step 8 —Closing Journal Entries (10 points) | Journal entries use accurate accounts and amounts; and debits and credits are used correctly. | Journal entries mostly use accurate accounts and amounts; and debits and credits are used correctly. | Journal entries have some errors in use of accounts and amounts; and debits and credits are only somewhat used correctly. | Journal entries have some errors in use of accounts and amounts; and debits and credits are not used correctly. |
| Steps 9 and 10 —Posted and Post-closingTrial Balance. (10 points) | Posting is correct leading to an accurate trial balance. | Posting is mostly correct leading to a mostly correct trial balance. | Posting has several errors leading to a trial balance with several errors. | Posting is done poorly or not at all, leading to inaccurate or no trial balance. |
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