Cybertext com

Introduction

Building Blocks of Accounting .. A Financial Perspective

Alexis, when you are ready to have your work graded you will upload this file AB1290.xls or AB1290.xlsx,

F310 180613

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 markfriedman@miami.edu or call 305.284.6296. Grade will be based upon answers entered into the yellow filled cells.

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

Upload the binary file at cybertext.com

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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.

MF1234.xlsx

Excel Binary Workbook (.xlsb)

Welcome

Building Blocks of Accounting -- A Financial Perspective

The instructions start on row 22 of this page.

FIRST LAST SS File

Alexis Bell 1290 AB1290

For example,

01

In the date field enter the date of the transaction. If you do not enter a date value an error message will appear.

Transaction Date Account Name Description Debit Credit

0

01 Jun 01 0

00 Dec 31 0 0

00 Dec 31 0 0

00 Dec 31 0 0

In the account field enter the account number that corresponds to the account in the chart of accounts.

You can also use the pull down list to find the appropriate account number. If you use a number that

is not on the chart of accounts an error message will appear.

Transaction Date Account Name Description Debit Credit

0

01 Jun 01 1110 Cash

00 Dec 31 0 0

00 Dec 31 0 0

00 Dec 31 0 0

The name of the account will automatically appear in the name column. If it is the wrong

account renter the correct account number.

Enter the description in the description field.

Transaction Date Account Name Description Debit Credit

0

01 Jun 01 1110 Cash Joseph's investment

00 Dec 31 0 0

00 Dec 31 0 0

00 Dec 31 0 0

Enter the amount in the debit field.

Transaction Date Account Name Description Debit Credit

Transaction # 1 Not in Balance by $40,000.

01 Jun 01 1110 Cash Joseph's investment 40,000.00

00 Dec 31 0 0

00 Dec 31 0 0

00 Dec 31 0 0

Enter the second account number.

Transaction Date Account Name Description Debit Credit

Transaction # 1 Not in Balance by $40,000.

01 Jun 01 1110 Cash Joseph's investment 40,000.00

00 Dec 31 3100 Capital Stock Joseph's investment

00 Dec 31 0 0

00 Dec 31 0 0

Enter the amount in the credit field.

Transaction Date Account Name Description Debit Credit

0

01 Jun 01 1110 Cash Joseph's investment 40,000.00

00 Dec 31 3100 Capital Stock Joseph's investment 40,000.00

00 Dec 31 0 0

00 Dec 31 0 0

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.

Note:

Save and make backup copies regularly.

Welcome to the worlds first ePractice case, an individualized, internet generated and graded case study that focuses on the analytically portion of the accounting cycle while automating the repetitive posting cycle. NOTE: If the program is not working e-mail markfriedman@miami.edu, 305.284.6296.

Step I - The Chart of Accounts 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 II – Journalizing the Transactions. Using your unique transactions record the corresponding general journal entry, rounding to two decimal places.

June 1: Joseph made an investment in Byte of Accounting, Inc. by purchasing 2,000 shares of its common stock for $40,000 cash. The par value of the common stock was $20 per share.

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.

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 Cosing Entries. Based upon the information from your Worksheet or from your Financial Statements, prepare the closing entries.

Chart of Accounts

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

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

Byte of Accounting, Inc.

Alexis Bell 1533

Transaction Description of transaction

01. June 1: Byte of Accounting, Inc. acquired $50,400 in cash from Lauryn and issued 2,400 shares of its common stock.

02. June 1: Byte of Accounting, Inc. issued 2,600 shares of its common stock to Alexis Bell after $22,680 in cash and computer equipment with a fair market value of $31,920 were received.

03. June 1: Byte of Accounting, Inc. issued 2,122 shares of its common stock after acquiring from Courtney $34,650 in cash, computer equipment with a fair market value of $9,240 and office equipment with a fair value of $672.

04. June 2: A down payment of $33,000 in cash was made on additional computer equipment that was purchased for $165,000. A five-year note was executed by Byte for the balance.

05. June 4: Additional office equipment costing $700 was purchased on credit from Discount Computer Corporation.

06. June 8: Unsatisfactory office equipment costing $140 was returned to Discount Computer for credit to be applied against the outstanding balance owed by Byte.

07. June 10: Byte paid $25,250 on the balance it owed on the June 2 purchase of computer equipment.

08. June 14: A one-year insurance policy covering its computer equipment was purchased by Byte for $5,472 in cash. The effective date of the policy was June 16.

09. June 16: A check in the amount of $7,750 was received for consulting revenue.

10. June 16: Byte purchased a building and the land it is on for $125,000, to house its repair facilities and to store computer equipment. The lot on which the building is located is valued at $20,000. The balance of the cost is to be allocated to the building. Byte made a cash down payment of $12,500 and executed a mortgage for the balance. The mortgage is payable in eight equal annual installments beginning July 1.

11. June 17: Cash of $6,300 was paid for rent for June, July and August. Put the total amount into the Prepaid Rent account.

12. June 17: Received a bill of $475 from the local newspaper for advertising.

13. June 21: Accounts payable in the amount of $560 were paid.

14. June 21: A fax machine for the office was purchased for $750 cash.

15. June 21: Billed various miscellaneous local customers $4,800 for consulting services performed.

16. June 22: Paid salaries of $1,035 to equipment operators for the week ending June 18.

17. June 22: Received a bill for $1,140 from Computer Parts and Repair Co. for repairs to the computer equipment.

18. June 22: Paid the advertising bill that was received on June 17.

19. June 23: Purchased office supplies for $655 on credit. Record the purchase as an increase to the assets.

20. June 23: Cash in the amount of $3,845 was received on billings.

21. June 28: Billed $6,015 to miscellaneous customers for services performed to June 25.

22. June 29: Paid the bill received on June 22, from Computer Parts and Repairs Co.

23. June 29: Cash in the amount of $5,699 was received for billings.

24. June 29: Paid salaries of $1,035 to equipment operators for the week ending June 25.

25. June 30: Received a bill for the amount of $790 from O & G Oil and Gas Co.

26. June 30: Paid a cash dividend of $0.22 per share to the three shareholders of Byte. [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.

27. The rent payment made on June 17 was for June, July and August. Expense the amount associated with one month's rent.

28. A physical inventory showed that only $270.00 worth of office supplies remained on hand as of June 30.

29. The annual interest rate on the mortgage payable was 7.50 percent. Interest expense for one-half month should be computed because the building and land were purchased and the liability incurred on June 16.

30. Information relating to the prepaid insurance may be obtained from the transaction recorded on June 14. Expense the amount associated with one half month's insurance.

31. A review of Byte’s job worksheets show that there are unbilled revenues in the amount of $5,750 for the period of June 28-30.

32. The expense for depreciation follows:

Building - $241.00

Computer Equipment - $3,046.00

Office Equipment - $21.00

33. A review of the payroll records show that unpaid salaries in the amount of $621.00 are owed by Byte for three days, June 28 - 30.

34. The note payable relating to the June 2, and 10 transactions is a five-year note, with interest at the rate of 12 percent annually. The June interest expense from this note is $1,063.67.

35. 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

36. Close the revenue accounts.

37. Close the expense accounts.

38. Close the income summary account.

39. Close the dividends account.

General Journal

A Byte of Accounting, Inc.

General Journal

0

Transaction Date Account Name Description Debit Credit Total Balance

0 0

01 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

02 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

03 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

04 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

05 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

06 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

07 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

08 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

09 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

10 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

11 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

12 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

13 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

14 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

15 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

16 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

00 Dec 31 0 0 0 0 0 0 0 0 0 0

0 0

17 0 0 0 0 0 0