Cybertext building blocks of accounting a financial perspective

Introduction
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Building Blocks of Accounting .. A Financial Perspective
Introduction
hanlin, when you are ready to have your work graded you will upload your file
HW7882.xls or HW7882.xlsx, to the same screen that the project was downloaded from:
www.cybertext.com, The Book List, Building Blocks of Accounting .. A Financial Perspective
Enter password, Upload Your Excel File.
Keep two copies of your spreadsheet in two separate places in case one does not work
You may find it easier to work on this project if you print a hard copy of all the pages
NOTE:
If there are any questions about the project e-mail friedman@cybertext.com or call 305.284.6296
Your grade will be based upon answers entered into the shaded boxes
F1311 190827
FAQ
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Building Blocks of Accounting .. A Financial Perspective
FAQ Page 1
FAQ 01 My file used to upload, why is it not uploading?
Answer: Sometimes we unknowingly add items to a workbook that inhibits the upload process. The conversion to a Excel Binary
Workbook (*.xlsb) version generally fixes the problem. If the problem continues simple send your BINARY file
as an attachment with your username and password…friedman@cybertext.com
Windows Operating System
Select File
Select Save As
Select Save As Type:
Select Excel Binary Workbook (*.xlsb)
Select Save
Upload the binary file at cybertext.com
Apple Operating System
Select File
Select Save As
Select Format:
Select Excel Binary Workbook (*.xlsb)
Select Save
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Building Blocks of Accounting .. A Financial Perspective
FAQ Page 2
FAQ 02 When I try to enter information in the General Journal why does an error appears indicating that the cell protected?
Answer: The computer program is designed to save you time. Instead of requiring you to enter the description four
times the program automatically copies the description when you enter a new account number. This process
requires that the data entry is limited to those cells which contain unique information. The cells that you can
enter data into are the yellow filled cells.
FAQ 03 In the feedback section, what does it mean when I have points under reverse?
Answer: If you pay a telephone expense of $100.00
Telephone Expense 100
Cash 100
If you debit cash and credit telephone expense you have reversed the whole entry.
Cash 100
Telephone Expense 100
If you debit cash and credit anything else you have reversed part of the entry.
Cash 100
Rent Expense 100
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Building Blocks of Accounting .. A Financial Perspective
FAQ Page 3
FAQ 04 How does my instructor get my grade?
Answer: Every time you upload your grade is recorded in a table. Your instructor can look at the table whenever they
want to, although only the last grade counts. Keep a hard copy of your last upload for documentation.
FAQ 05 I have entered all the transactions and have completed the worksheet however I get following
message on the financial statements: "You must finish the worksheet before you can complete the ...."
Answer: The worksheet demonstrates that the accounting system is working. If all of your journal entries are
in balance then the Unadjusted Trial Balance and the Adjusting Entry columns will balance. The
Adjusted Trial Balance columns net the Unadjusted Trial Balance and the Adjusting Entry columns.
There are four steps to completing the worksheet:
1. Copy the account balances from the Adjusted Trial Balance into the either the Income Statement or the
Balance Sheet columns, (debits remain debits and credits remain credits).
2. Calculate the Net Income or Net Loss by finding the difference between the revenues and expenses.
3. Calculate the Net Income or Net Loss by finding the difference between the total of the debit balances and
the total of the credit balances of the accounts in the Balance Sheet columns of the worksheet.
4. Compare the two Net Incomes. If they are the same the financial statements will be displayed, otherwise
there is an error in the completion of the worksheet.
Excel Binary Workbook (.xlsb)

Welcome
Building Blocks of Accounting -- A Financial Perspective
The instructions start on row 28 of this page.
Version FIRST LAST SS File DATE
1311 hanlin wang 7882 HW7882 9/4/19 40909 2,803
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Building Blocks of Accounting .. A Financial Perspective
Welcome Page 1
Welcome to the world's first ePractice case, an individualized, internet generated and
and graded case study that focuses on the analytically portion of the accounting cycle.
Step 1 The Chart of Accounts includes all of the accounts that you can use to solve your case.
You may want to print the chart of accounts and use it as an easy reference guide.
Step 2 Journalizing the Transactions
Using your unique transactions record the corresponding general journal entry, rounding to
two decimal places, =Round(value,2).
Step 3 Using the Worksheet for the Period Ending December 31st as a reference, prepare the
Income Statement, Statement of Changes in retained Earnings and the Balance Sheet.
Step 4 Record the closing entries to Retained Earnings in the general journal.
Step 5 Upload the File.
Whenever you want to have cybertext.com grade your work submit it to them on the bottom
of the screen that you downloaded the file. If you have a problem uploading see FAQ 01.
Step 6 You will be graded on the Journal Entries and the four financial statements and the ratio analysis. The
case will be computer graded, therefore make sure all numbers are in the appropriate cells. The
computer will evaluate your transactions when grading your financial statements.
Step 7 Note: Save and make backup copies regular
Step IV – Prepare the Financial Statements. After you have entered all of the transactions and prepared the Worksheet, you are to prepare the Income Statement, Shareholder's Equity Statement and Balance Sheet using the forms provided.

Step III – Worksheet Although not graded, you need to complete the Worksheet. If each of your journal entries are in balance then your Unadjusted Trial Balance and the Adjusting Entry columns will be in balance. Your Adjusted Trial Balance will balance when you place each of the account balances into the correct debit or credit position in the Adjusted Trial Balance section of the Worksheet. .

Grading: You will be graded on the Journal Entries and the three financial statement. The case will be computer graded, therefore make sure all numbers are in the appropriate cells. The computer will evaluate your transactions when grading your financial statements.

Step VI – Upload the File. Whenever you want to have cybertext.com grade your work submit it to them on the bottom of the screen that you downloaded the file.

Step V – Prepare the Closing Entries. Based upon the information from your Worksheet or from your Financial Statements, prepare the closing entries.

Chart of Accounts
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Number Name Normal Balance Error # Message
1110 Cash Debit 1 Debit And Credit On Same Line
1120 Accounts Receivable Debit 2 Debit Before Credit
1130 Prepaid Insurance Debit 4 Need An Account Number
1140 Prepaid Rent Debit 8 Round To Two Decimal Places
1150 Office Supplies Debit 16 Need a Description
1211 Office Equip. Debit 32 Need a Date
1212 Accum. Depr.-Office Equip. Credit 64 Use account number once
1311 Computer Equip. Debit 128
1312 Accum. Depr.-Computer Equip. Credit 256
1411 Building Cost Debit 512
1412 Accum. Depr.-Building Credit 1024
1510 Land Debit
2101 Accounts Payable Credit
2102 Advanced Payments Credit
2103 Interest Payable Credit
2105 Salaries Payable Credit
2106 Income Taxes Payable Credit
2201 Mortgage Payable Credit
2202 Notes Payable Credit
3100 Capital Stock Credit
3200 Retained Earnings Credit
3300 Dividends Debit
3400 Income Summary Credit
4100 Computer & Consulting Revenue Credit
5010 Rent Expense Debit
5020 Salary Expense Debit
5030 Advertising Expense Debit
5040 Repairs & Maint. Expense Debit
5050 Oil & Gas Expense Debit
5080 Supplies Expense Debit
5090 Interest Expense Debit
5100 Insurance Expense Debit
5110 Depreciation Expense Debit
5120 Income Tax Expense Debit
Transactions
hanlin wang HW7882
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Byte of Accounting
The Byte of Accounting Corporation (Byte) is a computer advisory consulting bussiess that works with small and midsize businesses.
Business Operations:
After an initial review of a new client's operations a proposal is developed by a team to improve the client's operations by the purchase of off the shelf software or more often the modification of off the shelf software.
Significant Accounting Policies:
The business has adopted the following accounting policies:
l Fixed assets that cost less than $500.00 are expensed.
l The allowance method is used to account for bad debts.
l When calculating depreciation, assets purchased during a month are treated as if
purchased on the first day of the month.
Transaction Description of transaction
01. June 1: Jeremy, an investor, made an investment in Byte by purchasing 2,551 shares of its common stock paying $57,400.00 in cash, and contributing to Byte computer equipment with a fair market value of $12,880 and office equipment with a fair value of $1,148.
02. June 1: hanlin wang, an investor, made an investment in Byte by purchasing 2,610 shares of its common stock paying $30,240.00 in cash, and contributing to Byte computer equipment with a fair market value of $42,840.
03. June 1: Lauryn, an investor, made an investment in Byte by purchasing 1,800 shares of its common stock paying $50,400.00 in cash.
04. June 2: Check # 6001 was issued to purchase a one-year insurance policy covering its computer equipment. The cost of the insurance is $6,144.00 and paid to Seth's Insurance. The effective date of the policy was June 16 and the invoice number was 2387.
05. June 4: Additional office equipment costing $4,400 was purchased on credit from Perez's Discount Computer Corporation, invoice number AB9865.
06. June 8: Check # 6002 for $30,000 was issued as a down payment for new computer equipment that cost $150,000 on invoice 827364 from Dell. A five-year note was executed by Byte for the balance.
07. June 8: Defective office equipment costing $880 was returned to Perez's Discount Computer for credit to be applied against the outstanding balance owed by Byte.
08. June 14: Check # 6003 was issued for $23,000 as a partial payment on the balance owed to Dell related to the purchase of computer equipment, invoice 827364.
09. June 16: A check in the amount of $7,750 was received for services performed for Pitman Pictures.
10. June 16: Byte purchased a building and the land it is on for $107,000.00 to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $17,000.00.
The balance of the cost is to be allocated to the building. Check # 6004 was used to make the down payment of $10,700.00. A thirty year mortgage with an inital payement due on August 1st, was established for the balance.
11. June 17: Byte received invoice number 26354 in the amount of $400.00 from Fida Marketing Agency for advertising.
12. June 17: Check # 6005 for $3,800.00 was paid for rent for June and July. Put the total amount into the Prepaid Rent account.
13. June 21: Received a bill for $1,115.00 from Computer Parts and Repair Co. for repairs to the computer equipment. The invoice number was 43254.
14. June 21: Billed various miscellaneous local customers $4,900 for consulting services performed.
15. June 21: Accounts payable in the amount of $3,520.00 were paid with Check # 6006.
16. June 22: Check # 6007 was used to pay salaries of $2,555.00 to equipment operators for the week ending June 18. Ignore payroll taxes.
17. June 22: Check # 6008 was used to pay invoice number 26354, the advertising bill that was previously received from Fida Digital Marketing Agency.
18. June 22: Check # 6009 was used to purchase a scanning machine for the office from Sicre's Office Machines Express for $650.00. The invoice number was 975-328.
19. June 23: Purchased office supplies for $480.00 from Office Max on account. The invoice number was 65498.
20. June 23: Received a bill for the amount of $990.00 from O & G Oil and Gas Co. The invoice number was 784537.
21. June 28: Billed various miscellaneous local customers $5,385 for consulting services performed.
22. June 29: Check # 6010 was used to pay invoice number 43254, the computer repair bill that was previously received from Computer Parts and Repair Co.
23. June 29: Byte received $5,101.00 from customers billed when work was completed.
24. June 29: Check # 6011 was used to pay salaries of $2,555.00 to equipment operators for the week ending June 25. Ignore payroll taxes.
25. June 30: Cash in the amount of $3,925 was received on billings.
26. June 30: Paid a cash dividend of $0.16 per share to the three shareholders of Byte, using Check # 6012 - 6014. [IMPORTANT NOTE: The number of shares of capital stock outstanding can be determined from the first three transactions.]
Adjusting Entries - Round to two decimal places =ROUND(number,num_digits).
27. June 30: A physical inventory showed that only $191.00 worth of office supplies remained on hand as of June 30.
28. June 30: The annual interest rate on the mortgage payable was 7.75 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16.
29. June 30: Information relating to the prepaid insurance may be obtained from transaction #4. Record a journal entry to reflect that one half month's insurance has expired.
30. June 30: The rent payment made in transaction# 12 was for June and July. Expense the amount associated with one month's rent.
31. June 30: A review of Byte’s job worksheets show that there are unbilled revenues in the amount of $5,375 for the period of June 28-30.
32. June 30: The fixed assets have estimated useful lives as follows:
Building - 31.5 years
Computer Equipment - 5.0 years
Office Equipment - 7.0 years
Use the straight-line method of depreciation. Management has decided that assets purchased during a month are treated as if purchased on the first day of the month. The building’s scrap value is $500. The office equipment has a scrap value of $400. The computer equipment has no scrap value. Calculate the depreciation for one month.
33. June 30: A review of the payroll records show that unpaid salaries in the amount of $1,533.00 are owed to the employees of Byte for three days, June 28 - 30.
34. June 30: J. Collins, the Internal Auditor, indicated that $1,240.00 of the revenue recorded in June will not be earned until August.
35. June 30:
The note payable in transaction #6 and transaction #8 is a five-year note, with interest at the rate of 12 percent annually. Interest expense should be computed based on a 360 day year.
[IMPORTANT NOTE: The original note on the computer equipment purchased on June 2 was $120,000. On June 10, eight days later, $23,000 was repaid. Interest expense must be
calculated on the $120,000 for eight days. In addition, interest expense on the $97,000 balance of the loan ($120,000 less $23,000 = $97,000) must be calculated for the 20 days remaining in the month of June.]
36. June 30:Income taxes are to be computed at the rate of 25 percent of net income before taxes.
[IMPORTANT NOTE: Since the income taxes are a percent of the net income you will want to prepare the Income Statements through the Net Income Before Tax line. The worksheet contains all of the accounts and their balances which you can then transfer to the appropriate financial statement.]
Closing Entries
37. Close the revenue accounts.
38. Close the expense accounts.
39. Close the income summary account.
40. Close the dividends account.
General Journal
A Byte of Accounting, Inc.
General Journal
Transaction Date Account Name Description Debit Credit Total Balance
01 Jun 01 1110 Cash 0 0
01 Jun 01 3100 Capital Stock 0 0 0
0 0
0 0
02 Jun 01 1110 Cash 0 0
02 Jun 01 1311 Computer Equip. 0 0 0
02 Jun 01 1211 Office Equip. 0 0 0
02 Jun 01 3100 Capital Stock 0 0 0
03 Jun 01 1110 Cash 0 0
03 Jun 01 1311 Computer Equip. 0 0 0
03 Jun 01 3100 Capital Stock 0 0 0
0 0
04 Jun 02 1311 Computer Equip. 0 0
0 0
0 0
0 0
05 0 0
0 0
0 0
0 0
06 0 0
0 0
0 0
0 0
07 0 0
0 0
0 0
0 0
08 0 0
0 0
0 0
0 0
09 0 0
0 0
0 0
0 0
10 0 0
0 0
0 0
0 0
11 0 0
0 0
0 0
0 0
12 0 0
0 0
0 0
0 0
13 0 0
0 0
0 0
0 0
14 0 0
0 0
0 0
0 0
15 0 0
0 0
0 0
0 0
16 0 0
0 0
0 0
0 0
17 0 0
0 0
0 0
0 0
18 0 0
0 0
0 0
0 0
19 0 0
0 0
0 0
0 0
20 0 0
0 0
0 0
0 0
21 0 0
0 0
0 0
0 0
22 0 0
0 0
0 0
0 0
23 0 0
0 0
0 0
0 0
24 0 0
0 0
0 0
0 0
25 0 0
0 0
0 0
0 0
26 0 0
0 0
0 0
0 0
27 0 0
0 0
0 0
0 0