Objectives This Project Is Mostly A Review Of The Accounting Process That You Learne 2412488

Objectives This project is mostly a review of the accounting process that you learned in your first financial accounting class (ACC207 at Queens). The accounting process is essential to making “accounting” work. Accounting is an information system that captures, organizes, stores, and reports business and economic events to users for decision-making. Accountants are responsible to develop, manage, and control that process. That requires a complete understanding of how the process works and constant attention to making the system more efficient and effective. This project builds on your work in the first accounting financial accounting class by • Giving you a “context” in which the transactions you learned in ACC207 are applied. This means that you are no longer in a “Chapter” about receivables and know that the entry required involves receivables – but instead you are given an event and must determine how to measure and capture it. In other words – apply what you know in a more realistic business context. • Giving you transactions that sometimes require you to think about what you need and then find that information within what you have been given. • Making you think about accrual accounting and particularly, what adjustments are needed to properly state financial statements using accrual accounting. Whereas in ACC207 you might have been given a transaction and asked to make the adjusting entry – in this project, you are recording ALL the transactions and you must determine which transactions require adjusting entries. • Having you follow the process from start to finish – creating financial statements (particularly a cash flow statement) after having recorded ALL the events of a business for a year. Summary of the Project You are provided a “General Ledger” for the Penguin Corporation, the beginning balances of their accounts and all the transactions that occurred during its Fiscal Year ending 7/31/17 (8/1/16 – 7/31/17). First you will post the beginning balances to the Prior Year trial balance and to the general ledger. Then you will record all the transactions in journal entry form, post them to the general ledger and create a correct unadjusted trial balance that balances. You will then determine what adjusting and reclassification entries are needed to properly state the records of Penguin on a full accrual basis, make the necessary computations, write and post the adjusting/reclassification entries to the general ledger, and create a correct adjusted trial balance that balances. Finally you will create a properly formatted multi-step Income Statement, Statement of Stockholders’ Equity, classified Balance Sheet, and Statement of Cash Flows (direct method) from the adjusted trial balance and General Ledger. You will then write and post the closing entries and create a correct post-closing trial balance that balances. How the Project Starts The Penguin Corporation has been in business for many years. Their fiscal year runs from 8/1 to 7/31. You will be provided the information described below. You should read and review all of it (and ask questions about information you don’t understand) prior to beginning the project. • The Project will be completed in Excel. You will be provided an Excel Workbook with two worksheets labeled Ledger and Trial Balance. The Workbook is explained in a separate document on the Excel requirements for this project. • Beginning Trial Balance account balances as of July 31, 2016. This trial balance includes their complete chart of accounts at this time. • A list of all the transactionsthat occurred in the fiscal year ending 7/31/17 (8/1/16 to 7/31/17) to this point. Most, but not all, of these transactions are “summarized” – meaning that they contain all the activity for the whole year which would have likely been recorded in various journals. For example, there is only one transaction for credit sales for the whole year – this is the total of all the individual credit sales transactions that occurred during the fiscal year. • Other information about the company, its accounting policies, and details of certain beginning account balances. • Additional information to assist in making some of the requiredadjusting entries. How the Project Proceeds You will submit the project in stages for grading: Assignment 2-1 (Due Friday, 9/15/17). You are to submit your Excel Workbook with the following complete: • The beginning trial balance and beginning balances posted to the general ledger • All journal entries for the transactions during the year should be written [they should not yet be posted to the general ledger] Assignment 2-2 (Due Wednesday, 10/11/17). You are to submit your Excel Workbook with the following complete: • All transaction journal entries should be posted to the general ledger and an unadjusted trial balance created • All adjusting journal entries should be written and posted to the general ledger and an adjusted trial balance created. Assignment 2-3 (Due Monday, 10/30/17). You are to submit your Excel Workbook with the following complete: • All financial statements complete • Closing entries written, posted to the general ledger, and post-closing trial balance complete Project Rules and Advice • The point of submitting the project in stages is to find errors that need correction before you get to the financial statements. You will need to correct any errors that you have made after each submission (and grading) so that you do not lose points on the final financial statements too. • I remind you again that this is an individual and not a group assignment and falls under the Queens Honor Code policies – see the syllabus for details. You are here to learn HOW to get the answer – not just to have someone give you the answer. • DON’T PROCRASTINATE! Start on this project early and work on it continuously. That is the best way to assure that you can get help if you run into problems • Everyone should do well on this project if they follow the points above. I am always here to help you if you have an issue. You can: o Ask questions in class o See me outside of class o Email me your project with specific questions or have me look at it “generally” to give you advice on where you might be going wrong. Note that when you come to me (or send me your spreadsheet) for help, I will likely not simply give you the answer. I will work to help you find the answer – it is the process that is most important! Yes, you would like to get to the “correct” answer in the end – but one minor mistake may cause an unbalanced trial balance or the incorrect income number. Those issues happen to everyone (including me). What you need to learn is how to find and correct your mistakes.



Prof. Angela


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