accounting

COURSE CODE :BCO114 COURSE NAME: ACCOUNTING I Task brief & rubrics

Task

Final:

· Individual task

· You must answer all the questions.

· When solving problems, you must clearly explain all the steps you are doing, and why are you making those steps.

· Show all your workings, a numeric answer is not enough.

· You should submit a document in Word format.

Formalities:

· Use one page per answer.

· Cover, Table of Contents, References and Appendix are excluded of the total wordcount.

· Font: Arial 12,5 pts.

· Text alignment: Justified.

Submission: Week (13) – Via Moodle (Turnitin). Sunday May 9th.

Weight: This task is a 100% of your total grade for this subject.

It assesses the following learning outcomes:

· Understand the nature and general purpose of financial statements.

· Identify the steps in the accounting cycle, adjusting entries.

· Closing temporary accounts.

· Demonstrate understanding of the Balance Sheet and the accounting equation.

· Apply acquired knowledge and skills to prepare an income statement and a statement of retained earnings.

· Inventories and the cost of goods sold.

Assignment: A) General Journals.(15 points) On 1 January 2020, ana Almeida began a new business, called Future Inc., a service company dedicated to developing digital marketing campaigns for financial institutions. The following transactions were completed by the business during January:

2 January: Issued 1000 shares of capital stock in exchange for her investment of €100,000 cash.

3 January: Purchased IT equipment for €50,000, paying €15,000 cash and signing a note payable for the balance.

7 January: Acquired furniture for the new office for 60,000, paying $10,000 cash and signing a note payable for the balance.

8 January: Borrowed €100,000 from a bank.

10 January: Billed customers €75,000 for services performed. B) Adjusting entries. (15 points)

By the end of December 2020, Peter Ustinov, chief accountant of Pearl associates is working to finish his accounting for the month. He realizes that he still needs to prepare the adjusting entries, and he has the following information:

1. Salaries earned by employees that have not yet been recorded or paid amount to €15,600.

2. Depreciation of the IT equipment is based on an estimated life of 3 years. The straight-line method is used. Depreciation of the Furniture is based on an estimated life of 5 years. The straight-line method is used.

IT equipment was acquired December 31st last year for a price of €1,500,000.

Furniture was acquired June 30th 2020 for a value of €150,000.

3. The company signed an insurance contract by February 1st 2020 for one year, with a value of €45,000.

4. A 12-month bank loan in the amount of €100,000 had been obtained with an interest computed at an annual rate of 10 percent on July 31st 2020. The entire €100,000, plus all of the interest accrued over the 12-month life of the loan, is due in full on July 31st of the upcoming year.

5.- Unrecorded Income Taxes Expense accrued in December amounts to €8,400. This amount will not be paid until January 15.

C) The company Mediaset has the below trial balance by December 31st 2019.

1.- Prepare closing entries in general journal format. (20 points)

2.- Prepare an Income Statement. (10 points)

3.- Prepare a Balance Sheet. (10 points)

4.- Prepare a Statement of retained earnings (10 points)

Trial Balance
Company Mediaset.
December 31st 2020
Cash			25.369
Store (Buildings)			979.794
Office Furniture			45.698
Inventories			21.548
Unexpired insurance			20.000
Capital Stock				300.000
Retained Earnings				100.000
Note Payable				295.899
Acc. Payable				85.125
Tax Payable				5.000
Acc. Depreciation				27.419
Acc Depreciation store				244.949
Dividend			12.000
Sales				1.125.000
COGS			996.182
Consulting expenses			1.100
Insurance expenses			950
Salary expenses			5.892
Utility expenses			3.164
Depreciation expense			9.140
Store depreciation expense			48.990
Tax expense			13.565
TOTAL			2.183.391	2.183.391

D) Brief questions

1.- Define what is a balance Sheet and its use. (5 points)

2.- Define what is an Income Statement and its use. (5 points)

3.- Explain and give a numeric example of the differences between LIFO, FIFO and Average methods for inventory valuation. (10 points)

Rubrics

	Descriptor
9-10	The student demonstrates an excellent understanding of the concepts.
8-8.9	The student demonstrates a good understanding of the concepts.
7-7.9	The student demonstrates a fair understanding of the concepts.
6-6.9	The student demonstrates some, but insufficient understanding of the concepts.
3-5.9	The student demonstrates insufficient understanding of the concepts. They may mention some relevant ideas or concepts, although it is clear that the relationship between them is not understood by the student.
1-2.9	The student demonstrates insufficient understanding of the concepts and does not mention any relevant ideas or concepts.
0	The student leaves the question blank or cheats.