APPENDIX I INTRODUCTION This project includes the steps in the accounting cycle. There are three parts to this project. You will need to create working papers for the general journal,

general ledgers cards, financial statements, and a ten-column worksheet. MANUAL ACCOUNTING Part A: The first task is to complete the work sheet and financial statements for the month of July and then to prepare and post adjusting and closing entries and prepare a post-closing trial balance. You are given the July 31 trial balance from which to work. Part B: You will journalize the August transactions, post to the ledger accounts, and prepare a trial balance. Part C: Your next job is to complete the work sheet, financial statements, adjusting and closing entries, and post-closing trial balance for August. PART A ACME Services rents its premises from the Westbrooke Shopping Centre. Using the additional information and the trial balance provided on the following page, do the following: 1. Complete a ten-column work sheet. 2. Prepare the monthly financial statements. 3. Set up a General Ledger with the appropriate accounts and balances. 4. Journalize and post the adjusting and closing entries. 5. Prepare a post-closing trial balance. Additional Information: Straight-line depreciation method is used by ACME Services. The equipment depreciates 20 per cent per year. (Note: Calculate the depreciation to the nearest dollar value.) Rent was prepaid for three months on July 1. Insurance was prepaid for one year effective July. Supplies on hand July 31 were valued at $260. Additional Accounts: Accumulated Depreciation-Equipment Income Summary Depreciation Expense-Equipment Rent Expense Insurance Expense Supplies Expense Accounting and Payroll Capstone Project 121 302 510 511 512 513 Page 1 APPENDIX I ACC. NO. ACCOUNT TITLE 100 Cash 115 Prepaid Rent 116 Prepaid Insurance 117 Supplies ACME Services Trial Balance July 31, 2020 120 Equipment 200 Accounts Payable 201 Bank Loan 300 R. Schultz, Capital 301 R. Schultz, Withdrawals 400 Accounting Income 401 Taxes Income 500 Advertising Expense 501 Cleaning Expense 502 Electricity and Water Expense 503 Equipment Repairs Expense 504 Film Rental Expense 505 Film Transportation Expense 506 General Expense 507 Heating Expense 508 Salaries Expense 509 Telephone Expense Totals Accounting and Payroll Capstone Project DEBIT $ 5,653 6,000 1,800 520 89,563 1,600 2,563 850 632 2,293 3,563 248 350 858 6,801 95 $ 123,389 CREDIT $ 890 10,387 94,212 15,493 2407 $ 123,389 Page 2 APPENDIX I The following source documents came across the desk of the accountant during the month of August. Do the following: 1. 2. Journalize the source documents and post to the General Ledger. Prepare a trial balance. Aug. 7 Aug. 14 Cash register tapes for the week showed accounting income transactions No. 5345 to No. 6253 for total sales of $2 858. The money was deposited in the bank account. Weekly sales report for the taxes income showed a net income of $225. The money was deposited in the bank account. Purchases invoices received from: Electronics Canada Ltd., $256 for final adjustments to the projector; The Daily Sentinel, $750 for newspaper advertisements. Cheques issued to: City Hydro, No. 375, $350 for electricity and water; Bell Canada, No. 376, $45. Cash register tapes for the week showed accounting income transactions No. 6254 to No. 8871 for total sales of $7 534. Weekly sales report for the taxes income showed a net income of $612. Purchases invoices received from: International Film Distributors, $1 289 for rental of the film shown from August 1 to 7; Commercial Cleaners Ltd., $420 for cleaning the premises in the first half of the month. Cheques issued to: Craig Stationers, No. 377, $35 for supplies; International Film Distributors, No. 378, $890 on account; V. Schultz, the owner, No. 379, $350 for drawings; Employees, No. 380 fo∙390, for a total of $2 890 for salaries from August 1 Accounting and Payroll Capstone Project Page 3 APPENDIX I Aug. 21 Aug. 28 ● Cash register tapes for the week showed accounting income transactions No. 8872 to No. 11 608 for total sales of $8 132. Weekly sales report for the taxes income showed a net income of $657. Purchases invoices received from: Air Canada, $178 for transportation of film; CCHH Radio and TV, $371 for spot advertising; Stinson Fuels, $356 for heating oil. Cheques issued to: Electronics Canada Ltd., No. 391, $256 on account; The Daily Sentinel, No. 392, $750 on account; Triangle Office Supply, No. 393, $445 for supplies. Cash register tapes for the week showed accounting income transactions No. 11 609 to 14 142 for total sales of $7 483. Weekly sales report for the taxes income showed a net income of $589. Purchases invoices received from: International Film Distributors, $2 658 for rental of film from August 8 to 28; Commercial Cleaners Ltd., $435 for cleaning of premises. Cheques issued to: Commercial Cleaners Ltd., No. 394, $420 on account; V. Schultz, the owner, No. 395, $350 for personal drawings; Employees, No. 396 to No. 406, for a total of $2 635 for salaries from August 15. PART C Using the additional information given below, complete the following procedures for the end of August: 1. Prepare a ten-column work sheet. 2. Prepare the financial statements. 3. Journalize and post the adjusting and closing entries. 4. Prepare a post-closing trial balance. Additional Information: Supplies on hand, August 31, were valued at $300. Don't forget the other adjusting entries from July 31. Accounting and Payroll Capstone Project Page 4