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CASE STUDY - THE COMPLETE ACCOUNTING CYCLE
Name: JAN PATRICK BRACEROS
This Case Study is worth 100 points, or 10% of your final course grade.
This Case Study relates to TCOs E and F, and Chapters 2 and 3.
MAKE SURE TO COMPLETE ALL REQUIREMENTS WHICH ARE LISTED BELOW.
There are 10 sheets in the Workbook, including this one.
All of the information that you need for the project is located in this Workbook.
Requirements	Sheet in Workbook
Requirement 1—Prepare the Journal Entries in the General Journal	Journal Entries
Requirement 2—Post Journal Entries to the General Ledger	General Ledger
Requirement 3—Prepare a Trial Balance	Trial Balance
Requirement 4—Prepare the Adjusting Entries	Adjusting Entries
Requirement 5—Post Adjusting Entries to the General Ledger	General Ledger
Requirement 6—Prepare an Adjusted Trial Balance	Adjusted Trial Balance
Requirement 7—Prepare the Financial Statements	Financial Statements
Requirement 8—Prepare the Closing Entries	Closing Entries
Requirement 9—Post Closing Entries to the General Ledger	General Ledger
Requirement 10—Prepare the Post Closing Trial Balance	Post-Closing Trial Balance
Hint for success: Review the Week 2 Lesson prior to starting this project.
There are also hints contained within certain cells on some of the Worksheet tabs.
You can hover over the red pointer at the top right-hand corner of the cell to read the hint.
Hints are provided for the following balances:
1) The debits for the journal entries are on the Journal Entries tab.
2) The credits for the journal entries are on the Journal Entries tab.
3) The cash balance is on the General Ledger tab.
4) The debits for the trial balance are on the Trial Balance tab.
5) The credits for the trial balance are on the Trial Balance tab.
6) The debits for the adjusted trial balance are on the Adjusted Trial Balance tab.
7) The credits for the adjusted trial balance are on the Adjusted Trial Balance tab.
8) Net income for the income statement is on the Financial Statements tab.
9) Retained earnings as of July 31 are on the Financial Statements tab.
10) Total assets for the balance sheet are on the Financial Statements tab.
11) Total liabilities and shareholders' equity for the balance sheet are on the Financial Statements tab.
12) The debits for the post-closing trial balance are on the Post-Closing Trial Balance tab.
13) The credits for the post-closing trial balance are on the Post-Closing Trial Balance tab.

Sheet1

Journal Entries

Requirement #1:
During its first month of operation in July, the Quick Tax Corporation, which specializes in tax preparation,
completed the following transactions.
July 1	Began business by making a deposit in a company bank account of $40,000, in exchange
for 4,000 shares of $10 par value common stock.
July 3	Paid the current month's rent, $2,500
July 5	Paid the premium on a 1-year insurance policy, $3,600
July 7	Purchased supplies on account from Little Company, $700.
July 10	Paid employee salaries, $2,800
July 14	Purchased equipment from Lake Company, $9,500. Paid $1,500 down and the balance was
placed on account. Payments will be $500.00 per month for 20 months. The first payment is due 8/1.
Note: Use accounts payable for the balance due.
July 15	Received cash for preparing tax returns for the first half of July, $6,500
July 19	Made payment on account to Lake Company, $500.
July 31	Received cash for preparing tax returns for the last half of July, $8,250
July 31	Declared and paid cash dividends of $450.
Prepare journal entries to record the July transactions in the General Journal below.	Use the following account names for journal entries.
Chart of Accounts: Account Title (Normal Balance)
Date	Account Names	Debit	Credit
1-Jul	Cash a/c Dr.	40,000	Assets
to common stock	40,000	Cash (Debit)
3-Jul	rent expense a/c Dr	2,500	Prepaid Insurance (Debit)
to cash	2,500	Supplies (Debit)
5-Jul	prepaid isurance a/c Dr.	3,600	Equipment (Debit)
to cash	3,600	Accumulated Depreciation - Equipment (Credit)
7-Jul	supplies a/c/ Dr	700
to account payable	700	Liabilities
10-Jul	Salary expense a/c Dr.	2,800	Accounts Payable (Credit)
to Cash	2,800	Income Tax Payable (Credit)
14-Jul	Equipment A/c Dr.	9,500
To cash	1,500	Stockholders' Equity
accounts payable	8,000	Common Stock (Credit)
15-Jul	cash a/c Dr.	6,500	Retained Earnings (Credit)
To serivce Revenue(tax)	6,500	Dividends (Debit)
19-Jul	Account payable A/c DR.	500
cash	500	Revenue
31-Jul	cash	8,250	Tax Preparation Revenue (Credit)
tax preparation revenue	8,250
31-Jul	dividends	450	Expenses
cash	450	Rent Expense (Debit)
Salaries Expense (Debit)
74,800	74,800	Insurance Expense (Debit)
Supplies Expense (Debit)
Depreciation Expense (Debit)
Income Tax Expense (Debit)
Note: Remember that debits must equal credits—all of your journal entries should balance.

General Ledger

This Sheet will be used for Requirements 2, 5, and 9.
Requirement #2:
Post the July journal entries to the following T-accounts and compute ending balances.
Cash DeVry: The balance of the Cash account after posting all journal entries should be $43,400.	Tax Preparation Revenue
Service Revenue 6500	rent 2500	cash 6500
Service Revenue 8250	prepaid insurance 3600	cash 8250
salaries 2800
Advances 500	total 14750
divident 450
bal c/d 4900
total 14,750	14,750
1- August Balance b/d 4900
Prepaid Insurance	Rent Expense
cash 3600	cash 3- jul Cash 2500	31 Bal 2500
2500	2500
3600	1 Aug Bal B/d 2500
Supplies	Salaries Expense
cash 700	cash 2800
700
Equipment	Bank A/c/
cash 900	Common Stock 40000	Balance C/d 40000
40000	40000
900	1 August Balance b/d 40000
Accumulated Depreciation - Equipment	Supplies Expense
equipment(accounts payable) 2000
Accounts Payable	Depreciation Expense
cash 500	equipment (cash) 10000
bal c/d 9500
total 10000	total 10000
bal b/d 9500
Income Tax Payable	Income Tax Expense
Common Stock	Retained Earnings
31 jul Bal c/d 40000	cash 40000
40000	40000
1-aug Bal b/d 40,000
Dividends
450
450

Trial Balance

Requirement #3:
Prepare a trial balance for July in the space below.
Quick Tax Corporation
Trial Balance
July 31
Account Names	Debits	Credits
cash	43,400
equipment	9,500
prepaid insurance	3,600
supplies	700
accounts payable	8,200
common stock	40,000
dividend	450
tax preparation revenue	14,750
rent expense	2,500
salaries expense	2,800
supplies
62,950 DeVry: Debits equal $62,950	62,950 DeVry: Credits equal $62,950

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 supplies is $300.
c) The estimated depreciation on equipment is $125.
d) The estimated income taxes are $2700.
Date	Account Names	Debit	Credit
31-Jul	Prepaid Insurance	300
31-Jul	Supplies	400
31-Jul	Accumulated Depreiciation Equio	125
31-Jul	Income Tax	2700
31-Jul	Insurance Expense	300
31-Jul	Supplies Expense	400
31-Jul	Depreciation Expense	125
31-Jul	Income Tax Expense	2,700
3,525	3,525
Requirement #5:
Post the adjusting entries to the General Ledger T-accounts and compute adjusted balances.

Adjusted Trial Balance

Requirement #6:
Prepare an adjusted trial balance in the space below.
Quick Tax Corporation
Adjusted Trial Balance
July 31
Account Names	Debits	Credits
cash	43,400
prepaid insurance	3,300
supplies	300
equipment	9,500
Accumulated depreciatiion Equipment	125
Account payable	8,200
income tax payable	450	2,700
common stock	40,000
Dividends	450
Service Revenue	14,750
Rent Expense	2,500
salaries Expense	2800
Insurance Expense	300
Depreciation Expense	125
Incom tax expense	2700
65825 DeVry: Debits equal $65,775	65775 DeVry: Credits equal $65,775

Financial Statements

Requirement #7:
Prepare the financial statements for the Quick Tax Corporation as of July 31 in the space below.
You will only be preparing the income statement, statement of retained earnings, and the balance sheet.
The statement of cash flows is a required financial statement, but is not required for this case study.
Quick Tax Corporation	Quick Tax Corporation	Quick Tax Corporation
Income Statement	Statement of Retained Earnings	Balance Sheet
For the Month Ending July 31	For the Month Ending July 31	July 31
Revenues:	Retained Earnings, July 1	Assets:
Tax Preparation Revenue	$ 14,750	Add: Net Income	5,925	Cash	43,400
Subtotal	Supplies
Expenses:	Less: Dividends	450	Prepaid Insurance	3,600
Rent Expense	2,500	Retained Earnings, July 31	$ 5,475 DeVry: Retained Earnings equals $5,475	Equipment
Salaries Expense	2,800	Less: Accum Depreciation	125
Insurance Expense	3,600	Total Assets	56,375 DeVry: Total assets equals $56,375
Supplies Expense	2,000
Depreciation Expense	Liabilities:
Income Tax Expense	Accounts Payable
Total Expenses	Income Tax Payable
Total Liabilities
Net Income	$ 5,925 DeVry: Net Income equals $5,925	Stockholders' Equity:
Common Stock
Retained Earnings
Total Stockholders' Equity
Total Liabilities and
Stockholders' Equity
DeVry: Total Liabilities & Stockholders' Equity equals $56,375

Closing Entries

Requirement #8:
Prepare the closing entries at July 31 in the General Journal below.
Date	Account Names	Debit	Credit
Cash	42700
Prepaid Insurance	3600
Supplies	700
Equipments	9500
Tax Preparation Revenue	14750
Rent Expense	2500
Salaries Expense	2800
Accounts Payable	9500
Supplies Expense	2000
Common Stock	40000
Dividends	450
64250	64250
Requirement #9:
Post the closing entries to the General Ledger T-accounts and compute ending balances.

Post-Closing Trial Balance

Requirement #10:
Prepare a post-closing trial balance as of July 31 in the space below.
Quick Tax Corporation
Post-Closing Trial Balance
July 31
Account Names	Debits	Credits
Cash	42,700
Equipments	9,500
Prepaid Insurance	3,600
Tax Preparation Insurance	14,750
Rent Expense	2,500
Supplies	2,700
Accounts Payable	9,500
Common Stock	40,000
Dividends	450
Salaries Expense	2,800
64,250 DeVry: Debits equal $56,500	64,250 DeVry: Credits equal $56,500