demonstrate your ability to accurately record financial data|Essay guru
Posted: February 4th, 2023
Overview
In Milestone One, you completed the first part of your course project to demonstrate your ability to accurately record financial data. In Milestone Two, you will use your trial balance results from Milestone One to create financial statements. These financial statements will be part of the Summary Report that you will present to your employer in Module Seven.
Scenario
You were recently hired as an entry-level bookkeeper for a service business that recently opened. This is the first month in operation for the business and your first task is to record business transactions for their first month using the source documents and transaction data the owner will provide to you. Because this is a small business that does not use computerized accounting, you will apply the accounting cycle in Excel to record transactions and generate financial reporting results for the owner.
Directions
Report Financial Results: Use the account balances from the Trial Balance generated through the recording process in Milestone One to prepare the income statement, statement of owner’s equity, and balance sheet for the company. Then close temporary account balances using closing entries in the final step. Be sure to revisit any feedback received from Milestone One and make necessary corrections to ensure that statements are completed with accurate balance information. (You may refer to the blank Company Accounting Workbook Template if necessary, but keep in mind that your work for this milestone should be added to the work that was completed in your workbook for the previous milestone. You should also implement any feedback that was given during Milestone One.)
Specifically, you must address the following rubric criteria:
- Income Statement: Prepare the income statement using the adjusted trial balance
- Statement of Owner’s Equity: Prepare the statement of owner’s equity using the adjusted trial balance.
- Balance Sheet Assets: Prepare the balance sheet asset entries using the adjusted trial balance.
- Balance Sheet Liabilities: Prepare the balance sheet liabilities entries using the adjusted trial balance.
- Closing Entries: Complete the “Closing Entries” tab of the company accounting workbook by closing all temporary income statement amounts to create closing entries.
Guidelines for Submission
Build on your work from Milestone One to complete the “Income Statement,” “Statement of Stockholder’s Equity,” “Balance Sheet,” and “Closing Entries” tabs in your company accounting workbook. This should be completed and submitted using Microsoft Excel. Please refer to the video walkthrough linked below if you need more assistance with your submission.
SOLUTION
Milestone Two of the course project involves using the trial balance results from Milestone One to create financial statements. These financial statements will be part of the Summary Report to be presented to the employer in Module Seven. The task of recording business transactions for the first month of operation has been assigned to the newly hired entry-level bookkeeper. The bookkeeper will be using Excel to apply the accounting cycle, as the business is small and does not use computerized accounting.
The accounting cycle is a process that helps organizations keep track of their financial transactions and records. As an entry-level bookkeeper, you will be responsible for recording transactions, reconciling bank statements, preparing financial statements, and providing accurate reports to the business owner. The following are the steps in the accounting cycle:
- Analyze and record transactions in a journal.
- Post the transactions to the ledger.
- Prepare an unadjusted trial balance.
- Complete the adjusting entries.
- Prepare an adjusted trial balance.
- Prepare financial statements.
- Close the books for the accounting period.
In this scenario, you will be using Excel to apply the accounting cycle, which can make the process more efficient and accurate. The business owner will provide you with source documents and transaction data, which you will use to record transactions and generate financial reporting results.
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