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Accounting 100 Project Spring 2016

This is a formal project, and the following standards are to be applied:

If help is needed you may consult with instructor. You are encouraged to send the instructor drafts of your work to make sure that you are on the right track.

A.      All items must be typed, except for the T accounts which may be neatly handwritten (although using excel spreadsheet would be useful).

B.      Work must be collated in the following manner:

1.      Cover Sheet

2.      Problem 1 work (Financial Statements with proper headings) and brief written analysis.

3.      General Journal Entries (problem 2)

4.      Chart of Accounts-listing of all accounts with identification numbers (problem 2)

5.       Ledger/T-Accounts  (problem 2)

6.      Financial Statements (problem 2)

7.      Written Analysis (problem 2)

C.      No projects will be accepted after the deadline.  No exceptions.  The project submission deadline is on or before Thursday, July 28 at 11:59 PM. Early submission will be accepted and is encouraged.

D.     This project is worth 20 % of your overall semester grade.

Problem One:Below is the financial data for One Corporation for 2013, 2014 and 2015

 2015                                                                                                                    2014                                                       

1.       Equipment $83,005                                                                            Cash $14,500

Cash $17,286                                                                                       Marketable Securities $9,000                  

Accounts Receivable $49,317                                                           Accounts Receivable $31,000   

Owner’s Equity $265,230                                                                   Allowance for Bad Debt $2750

Plant $121,300                                                                                     Plant $121,300

Land $80,030                                                                                        Land $80,030

Accounts Payable $57,424                                                                 Equipment $83,005        

Marketable Securities $5,000                                                            Accounts Payable $49,000

Inventory $53,716                                                                                Long-Term Liabilities $75,000                             

Long-Term Liabilities $80,000                                                            Inventory $46,000

Allowance for Bad Debt $7,000                                                         Owner’s Equity $258,085

Net Sales   $611,873                                                                            Interest Expense $6400

Income Taxes $20,026                                                                        Operating Expense $97,000

Operating Expenses $122,183                                                           Net Sales $468,065      

Interest Expense $6400                                                                      Cost of Goods Sold $287,015

Cost of Goods Sold $428,354                                                             Income Taxes $16,775

2013                                                     

Owner’s Equity $244,752                                                                    

Accounts Payable $51,400                                                                  

Cash $12,996                                                                                         

Accounts Receivable $34,620                                                              

Allowance for Bad Debt $5,000                                                         

Inventory $48,201

Plant $121,300

Land $80,030

Marketable Securities $4,000

Equipment $83,005

Long-Term Liabilities $83,000

Cost of Goods Sold $335,555

Income Taxes $19,200

Interest Expense $6400

Operating Expense $104,121

Net Sales $511,773

Required:

*Prepare a multi-step Income Statement for each year

*Prepare a balance sheet for each year using the information given*

*Calculate Working Capital, Return on Investment and Return on Equity Ratios for each year

*Calculate Current Ratio and Acid-Test Ratio for each year

* Conduct a Trend Analysis and write a brief analysis on the financial position of the firm.

Problem Two:

2.       The following transactions occurred during the first 30 days of operation of a new services company:

January 1 Owners invested Cash of $25,000

January 3 The Company borrowed $20,000 from a bank

January 4 Equipment was purchased for $12,000 on account

January 5 Office Supplies were purchased for $2600 with Cash

January 7 $2500 Cash was spent on advertising to let the public know about the new company

January 8   Revenue of $7500 was earned on account

January 10 Revenue of $1250 was earned and received as Cash

January 11 Revenue of $1000 was earned on account

January 13 Paid $750 with a check toward Accounts Payable

January 15 Revenue of $6000 was earned on account

January 15 Employee wages of $2750 were paid with Cash

January 16 Revenue of $4300 was earned and received as Cash

January 17 $2500 was spent on advertising with a check

January 18 Received $1500 Check (a check is considered cash) to be applied against on account from customer

January 19 Revenue of $1600 was earned on account

January 20 Paid $750 cash toward Accounts Payable

January 21 Equipment was purchased for $8500 Cash

January 22 Revenue of $10,000 was earned and received as Cash

January 23 Paid $1000 Check toward bank loan

January 24 Paid Utilities bill of $1000 with Check

January 25 Revenue of $3000 was earned on account

January 26 $2500 Cash was spent on advertising

January 27 Paid $800 toward Accounts Payable

January 28 Revenue of $9100 was earned and received as Cash

January 29 Employee Wages of $2750 were paid with Cash

January 30 Paid $1000 Cash toward bank loan

**** If cash (or a check is received) on account, this means that accounts receivable is credited (decreased)

**** If revenue is earned on account, accounts receivable is debited (increased)

**** If cash is paid on account, accounts payable is debited (decreased), while cash is credited (also decreased)

·         Prepare journal entries for each of the transactions in either Word or Excel

·         Prepare a Chart of Accounts (for example  100 Cash, 101 Accounts Receivable, 102 Equipment, 201 Accounts Payable)

·         Set  up T accounts in an Excel spreadsheet for each category and record transactions (debits and credits)

·         Calculate net income for the month dated January 31, 2014 by preparing a detailed income statement (listing out each individual expense)

·         Prepare a balance sheet dated January 31, 2014

·         Prepare a short written analysis of your company’s financial performance during its first month of operations.  Include quantitative data in your summary. A paragraph or two is expected