Table 1*Enter your name, access code, and CRN below and then click the Activate button.This file is NOT to be shared with any person as it is specifically linked with your name.Date:Name:Access Code:CRN:Davenport UniversityACCT202 Practice Set*Click the following buttons to go to the corresponding worksheets:WINTER 2013
Instructions
Academic Integrity
Products
Chart of Accounts - GL
Chart of Accounts - AR
Chart of Accounts - AP
Purchases Journal
Cash Receipts Journal
Cash Payments Journal
General Journal Pg 1
General Journal Pg 2
General Journal Pg 3
General Ledger
A/R Sub-Ledger
A/P Sub-Ledger
Worksheet
Inventory Control Card
Transactions
ACTIVATE
Sales Journal
Table 1
You’re a Davenport University student pursuing a bachelor’s degree in business and employed at the AC Speed Company this semester as an intern. You’ve worked in various departments and on several projects so far, learning a lot about the company’s business operations. Management seems impressed with your enthusiasm and the quality of your work.The company’s accountant has just been called away for a family emergency and will likely be absent for a month or so. The General Manager asks you to take over the accountant’s regular duties on an interim basis. You’re nervous about doing so, but are confident that what you’ve learned in accounting class, plus your personal problem-solving skills, will make this a successful experience. What a great learning opportunity, not to mention an enhancement to your resume! b. Part 2 is an activity that requires you to analyze the company’s year-end financial statements to assist management in assessing the company’s position and making decisions about its future direction. b. You are encouraged to use your textbook’s table of contents (front) or index (back) to locate helpful references. h. Appearance counts! Pay attention to the format, to spelling, and to other details of appearance. This reflects on management’s perception of you as a professional. a. Final submission of all parts of this project must be in electronic (not paper) form. That is, you will submit your completed work via an assignment link in a Blackboard course site or via an email attachment. Follow your instructor’s directions. c. At the end of the month, total each column in each special journal and post that total to the general ledger. EXCEPT for entries in the “Other” columns, which must be posted individually to the general ledger. f. At this point in the closing process, the balances of all subsidiary ledger accounts would be totaled and that total compared to the balance of the corresponding control account in the general ledger. That is, the total of inventory control cards would be compared to the Merchandise Inventory balance; the customer subsidiary ledger total to the Accounts Receivable balance; and the vendor subsidiary ledger total to the Accounts Payable balance. Any discrepancies would be investigated and corrected. Giv ...
ICT role in 21st century education and it's challenges.
Table 1Enter your name, access code, and CRN below and then cli.docx
1. Table 1*Enter your name, access code, and CRN below and then
click the Activate button.This file is NOT to be shared with any
person as it is specifically linked with your
name.Date:Name:Access Code:CRN:Davenport
UniversityACCT202 Practice Set*Click the following buttons to
go to the corresponding worksheets:WINTER 2013
Instructions
Academic Integrity
Products
Chart of Accounts - GL
Chart of Accounts - AR
Chart of Accounts - AP
Purchases Journal
Cash Receipts Journal
Cash Payments Journal
General Journal Pg 1
General Journal Pg 2
General Journal Pg 3
General Ledger
2. A/R Sub-Ledger
A/P Sub-Ledger
Worksheet
Inventory Control Card
Transactions
ACTIVATE
Sales Journal
Table 1
You’re a Davenport University student pursuing a bachelor’s
degree in business and employed at the AC Speed Company this
semester as an intern. You’ve worked in various departments
and on several projects so far, learning a lot about the
company’s business operations. Management seems impressed
with your enthusiasm and the quality of your work.The
company’s accountant has just been called away for a family
emergency and will likely be absent for a month or so. The
General Manager asks you to take over the accountant’s regular
duties on an interim basis. You’re nervous about doing so, but
are confident that what you’ve learned in accounting class, plus
your personal problem-solving skills, will make this a
successful experience. What a great learning opportunity, not
to mention an enhancement to your resume! b. Part 2 is an
activity that requires you to analyze the company’s year-end
financial statements to assist management in assessing the
company’s position and making decisions about its future
direction. b. You are encouraged to use your textbook’s table of
contents (front) or index (back) to locate helpful references. h.
Appearance counts! Pay attention to the format, to spelling,
and to other details of appearance. This reflects on
management’s perception of you as a professional. a. Final
3. submission of all parts of this project must be in electronic (not
paper) form. That is, you will submit your completed work via
an assignment link in a Blackboard course site or via an email
attachment. Follow your instructor’s directions. c. At the end
of the month, total each column in each special journal and post
that total to the general ledger. EXCEPT for entries in the
“Other” columns, which must be posted individually to the
general ledger. f. At this point in the closing process, the
balances of all subsidiary ledger accounts would be totaled and
that total compared to the balance of the corresponding control
account in the general ledger. That is, the total of inventory
control cards would be compared to the Merchandise Inventory
balance; the customer subsidiary ledger total to the Accounts
Receivable balance; and the vendor subsidiary ledger total to
the Accounts Payable balance. Any discrepancies would be
investigated and corrected. Given the limited scope of this
project scenario, reconciliation between subsidiary ledgers and
control accounts is not possible. F. Part 2 of this project
requires you to analyze the company’s year-end financial
statements to assist the management of AC Speed in assessing
the company’s financial position and making decisions about its
future direction. c. After you calculate the ratios, consider
whether there is a trend over the three-year period. Also
compare the ratios you calculated for AC Speed with those
listed as industry averages. Review the information in Chapter
17 to help you determine what the ratios are telling you about
various aspects of AC Speed’s business operations.d. Use Word
to prepare a memo (minimum 500 words) to AC Speed’s general
manager, addressing the three questions listed at the bottom of
the ratios tab. This should be formatted as a business memo,
not an APA paper. Be sure to include a brief introduction and
conclusion in the memo. Each question should be addressed in
one or two paragraphs in the body of the memo. Remember that
the general manager will expect details/facts/ratios to support
statements you may make about the status of the business. Your
writing should be concise, clear, and readable, with a fairly
4. formal tone (since it’s addressed to AC Speed’s general
manager, who is likely to share it with other members of
management). Your instructor will provide the due date and
submission requirements for this part of the project.
Company Background & ScenarioProject Overview &
InstructionsA. Overviewc. This is an individual, not a team,
project. While you may discuss this project with others, you
must prepare and submit your own work. Refer to the academic
integrity statement in the project workbook.d. Before starting
work, review the entire project: all instructions, business
transactions descriptions, workbook sections, check figures, due
dates, and submission requirements.B. General Instructionsa.
The parts of this project, including specific business
transactions and steps in the accounting cycle, must be
completed in sequence. This is particularly important with
business transactions relating to purchases and sales of
inventory.c. These project instructions will not address every
detail of every task. If you have questions, ask your
instructor.e. If rounding is required, round to the nearest cent.
For example, $96.835 would be entered as $96.84.f. Use the
check figures provided to check your work as you progress
through the project. Investigate any discrepancies and correct
them as you go along.g. Refer to the project rubric to determine
how components of the project will be assessed.C. Submission
Requirementsb. Save backup copies of your work. If you have
multiple versions of the project, clearly label them for your own
reference and to ensure that you submit the appropriate version
to your instructor.c. You must read the academic integrity
statement in the project workbook and enter your student ID
number on the form to signify your agreement with and
adherence to that statement. Final project submissions will not
be accepted without this.D. Credit Terms & Inventory
Accountinga. When AC Speed purchases merchandise from a
supplier or vendor on account, they receive credit terms of 2/15,
net 30.b. When AC Speed sells merchandise to a customer on
account, they offer that customer credit terms of 2/30, net 45.d.
5. AC Speed uses a perpetual inventory accounting system and a
last-in, first-out (LIFO) inventory costing method.E. Financial
Accounting Steps:a. Record each business transaction, in
sequence by date, in the appropriate special journal or the
general journal. Also, immediately record any transaction
involving inventory, a customer, or a vendor in the appropriate
subsidiary ledger record.b. At the end of the month, post each
entry in the general journal to the general ledger.d. When
posting is completed, bring the balance in each general ledger
account up to date.e. When posting is completed, bring the
balance in each subsidiary ledger account up to date.g. List all
general ledger account balances in the unadjusted trial balance
columns of the worksheet. Use the sum function in Excel to
total the debit and credit columns. These totals should be
equal.i. Update general ledger account balances after posting
adjusting journal entries. k. Sort the dollars recorded in the
adjusted trial balance columns into either the income statement
or the balance sheet columns. Total these columns. The entry
of net income should cause the debit and credit columns to
equal one another. l. Use the income statement information on
the worksheet to prepare a multi-step income statement in good
form. Look at examples of this income statement format in
your textbook.m. Prepare a statement of retained earnings in
good form. Look at examples of this statement in your
textbook. Remember that net income from your just-completed
income statement is a necessary component of this statement.n.
Use the balance sheet information on the worksheet to prepare a
classified balance sheet. Remember that the ending retained
earnings balance from the just-completed statement is a
necessary component of the equity section of the balance
sheet.o. Prepare the end-of-month closing entries. Record these
entries in the general journal and post them to the general
ledger. Update balances in the general ledger accounts.p. List
the general ledger accounts that have balances other than zero
on the post-closing trial balance. The totals of the debit column
and the credit column should be equal.a. Before beginning this
6. part of the project, you will find it helpful to review Chapter 17
on financial statement analysis. Page 705, a summary of ratios,
will be particularly useful.
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Main Menu
Table 1JUNE JOURNAL TRANSACTIONSJune 1Signed a one-
year 18.5%, $180,000 note payable with First Bank.June
1Purchased 3,000 GPS units on Credit from Navistar for $35.00
per unit. June 1Issued 5,500 shares of common stock for $11 per
share (Refer to General ledger for description of common
stock). June 1Sold 2,000 DVD players on account to Toyota for
$75 per units, Invoice #5555.June 2Sold 3,500 GPS units on
account to Kia for $52 per unit, Invoice #5556.June 2Purchases
office supplies from Office Max on credit for $1,200.June 2Sold
900 docking stations for $64 per unit and 1950 GPS units for
$83 per unit on account to Nissan, Invoice #5560.June 3The
Board of Directors declared a cash dividend of $5 per share for
shareholders of record on June 5th, payable on June 12th.June
4Received payment from Toyota for May 11th saleJune 4Rented
part of the warehouse to a new tenant and received $4,900 for
three months rent (June, July, August). June 5Paid $2,100 to
Michigan Utility Co. for utilities bill that was recorded in May
as an Account Payable, Check #5278.June 7Received and paid
expense reports for travel and entertainment totaling $925,
Check #5279.June 8Paid for office supplies purchased on June
2nd, Check #5280.June 11Paid in full for the June 1 purchase
from Navistar, Check #5281.June 11Received a bill from the
law firm of Larry, Moe & Curly for $5,400, payable upon
receipt, for bond consulting fees, Check #5282.June 12Paid the
dividend that was declared on June 3, Check #5283.June
13Took advantage of a special deal to purchase 3,250 DVD
players on account from JVC for $48 per unit.June 13Purchased
850 GPS units on credit from Magellan for $33 per unit.June
15Sold 2,000 DVD players on credit to Fort Motor Co. for
7. $89.00 per unit, Invoice 5557. June 15Check # 5284 was issued
for payroll: $14,500 for salaried and $4,750 for wages.June
16Purchased 1,800 docking stations on credit from Samsung for
$42 per unit.June 17Issued a credit to Kia for the return of 350
defective units from the June 2nd sale. These units has a cost
basis of $35 per unit.June 17Returned the 350 defective units
received from Kia to Navistar.June 18Received payment in full
from Toyota for the June 1st sale.June 20While inspecting the
June 13th purchase, it was discovered that the GPS units were
programmed for South America instead of North America. AC
Speed returned the entire order to Magellan.June 20A
bankruptcy judge disallowed AC Speed's claim for $5,000 due
from General Motors. Management Decided to write off this
accounts receivable. June 22Sold 1,650 docking stations on
credit to Kia for $64.50 per unit, Invoice #5559.June 23Paid
$75,000 of the $162,500 owed to JVC from May 25, Check
#5285.June 23Received payment from Ford Motor Co. for
$175,000 of the $300,000 owed from May 5.June 24Purchased
a $100 international phone card for one of the sales
representative's upcoming European business trip, Check
#5286.June 25Paid in full for the purchase from JVC on June
13, Check #5287June 26Purchased 1,250 docking station from
Samsung for $41 per unit paying in cash, Check #5288June
27Sold 1,500 docking stations on credit to Honda for $61 per
unit, Invoice 5558.June 27Hired and paid a consultant $75,000
to devise a marketing plan. AC Speed's management felt this
was necessary to develop brand awareness. Check #5289.June
28AC Speed is behind in its mortgage payments to Bank of
America. Paid a total of $10,000 ($2,000 principal and $8,000
interest), Check #5290.June 29Received payment in full from
Honda for the June 25th transaction.June 29Paid in full for the
purchase from Magellan on May 31st, Check #5291.June
29Check #5292 was issued for payroll: $14,500 for salaries and
$4,750 for wages.June 30Paid the first month's principal
payment of $15,000 on the note payable. In addition, paid one
month's interest, Check #5293 June 30Issued bonds payable at
8. face value for $350,000 *All purchases on account terms of
2/15, n/30**All credit sales have terms of 2/30, n/45June
Month-end Adjustments:( A )AC Speed has earned one month of
the prepaid rent received from their tenant at the beginning of
June. ( B )The Company took a physical count of Office
Supplies on June 30 and found the following to be on
hand:Office Supplies - $2,465 ( C )AC Speed estimates bad debt
expense on a monthly basis rather than waiting until year-end.
The company uses the allowance method. Based on recent
industry estimates, AC Speed estimates that the allowance
account should be 2.5% of accounts receivable. ( D )The
Company took a physical inventory count on June 30 and found
the following inventory on hand:Merchandise Inventory -
$122,221 ( E )The Balance in the prepaid insurance account at
the beginning of June represents 4 months of coverage. Record
the amount of insurance for June. ( F )Depreciation on the
company's fixed assets for the month of June is as follows:1.
The furniture and equipment for the warehouse was purchased a
few years ago for $10,000. These assets have a 5-year life, an
expected salvage value of $1,000, and are depreciated using the
straight-line method. 2. The furniture and equipment for the
office was purchased last year for $8,500. these assets have a 7
year life, an expected salvage value of $1,500, and are
depreicated using stright-line method.
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Table 1Product NameDescriptionGPSIn vehicle GPS unitDVD
PlayerIn vehicle DVD playerDocking StationCell phone /
Mobile Communications Docking Station
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Table 1AC Speed CorporationChart of Accounts - General
LedgerBALANCE SHEET ACCOUNTS Assets Current
AssetsAcct #Account Name100Cash102Accounts
Receivable103Allowance for Doubtful
Accounts104Merchandise Inventory105Office
9. Supplies106Prepaid Insurance Property, Plant and
Equipment140Land145Building146Accumulated Depreciation -
Building151Equipment & Furniture -
Warehouse152Accumulated Depreciation - Equip & Furn. -
Warehouse153Equipment & Furniture - Office154Accumulated
Depreciation - Equip & Furn. - Office Liabilities Current
Liabilities201Accounts Payable202Wages Payable203Interest
Payable204Dividends Payable205Unearned Rent Long-Term
Liabilities250Notes Payable251Bonds Payable252Mortgage
(Warehouse) Payable Capital (Equity)300Common Stock, $1
Par, 100,000 Authorized; 60,000 shares
Issued/Outstanding301Paid In Capital - Excess of
Par330Retained Earnings340Treasury StockINCOME
STATEMENT ACCOUNTS Revenue500Sales510Sales
Discounts511Sales Returns & Allowances Cost of Goods
Sold600Cost of Goods Sold Operating Expenses700Wage
Expense (hourly workers)701Salaries Expense (Exempt
Staff)702Marketing Expense703Travel and Entertainment
Expense704Bad Debt Expense705Property Tax
Expense706Office Maintenance & Repair Expense707Legal
Expenses708Insurance Expense709Utilities Expense710Office
Supplies Expense711Telecommunications
Expense712Depreciation Expense - Equip & Furniture -
Warehouse713Depreciation Expense - Equip & Furniture -
Office Other Income800Rent Income Other
Expenses900Interest ExpenseOther1000Income Summary
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Table 1AC Speed CorporationChart of Accounts - Accounts
Receivable LedgerAccount NameGeneral MotorsFord Motor
Co.ToyotaHondaKiaNissan
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Table 1AC Speed CorporationChart of Accounts - Accounts
Payable LedgerAccount NameGarminJVCMagellanMichigan
Utility CompanyMotorolaNavistarSamsung
10. Main Menu
Table 1AC Speed CorporationSales JournalDateInvoice No.A/R
Account DebitedPost RefA/R - DR Sales - CRCGS -
DR Inv - CR
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Table 1AC Speed CorporationPurchases JournalDateCreditors
Account CreditedOther Account - DebitedPost RefA/P -
CRInventory - DROffice Supplies - DROther - DR
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Table 1AC Speed CorporationCash Receipts JournalDateAcct -
CR Customer Acct Other AcctPost
RefSales - CRA/R - CROther - CRSale Discount - DRCash -
DRCGS - DR Inv - CR
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Table 1AC Speed CorporationCash Payments JournalDateCheck
#PayeeAccount DebitedPost RefCash - CRInventory - CROther
- DRA/P - DR
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Table 1AC Speed CorporationGeneral JournalDateAccountsPost
RefDEBITCREDIT
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Table 1AC Speed CorporationGeneral JournalDateAccountsPost
RefDEBITCREDIT
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Table 1AC Speed CorporationGeneral JournalDateAccountsPost
RefDEBITCREDIT
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Table 1Account:CashAccount No.100TransactionAccount
15. aTransactionAccount BalanceDatePost
RefDEBITCREDITDEBITCREDITAccount:KiaTransactionAcco
unt BalanceDatePost
RefDEBITCREDITDEBITCREDITAccount:NissanTransactionA
ccount BalanceDatePost RefDEBITCREDITDEBITCREDIT
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Table 1Account:GarminAccount No.TransactionAccount
BalanceDatePost
RefDEBITCREDITDEBITCREDIT18000Account:MagellanAcco
unt No.TransactionAccount BalanceDatePost
RefDEBITCREDITDEBITCREDIT30000Account:MotorolaAcco
unt No.TransactionAccount BalanceDatePost
RefDEBITCREDITDEBITCREDIT58000Account:
NavistarAccount No.TransactionAccount BalanceDatePost
RefDEBITCREDITDEBITCREDIT50000Account:SamsungAcco
unt No.TransactionAccount BalanceDatePost
RefDEBITCREDITDEBITCREDITAccount:JVCAccount
No.TransactionAccount BalanceDatePost
RefDEBITCREDITDEBITCREDIT162500162500
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Table 1UnadjustedAdjustedIncome Bal. SheetTrial
BalanceAdjustmentsTrial BalanceStatementStmt. Own.
EquityAcct. No.Account
TitleDr.Cr.Dr.Cr.Dr.Cr.Dr.Cr.Dr.Cr.100Cash102Accounts
Receivable103Allowance for Doubtful
Accounts104Merchandise Inventory105Office
Supplies106Prepaid
Insurance140Land145Building146Accumulated Depreciation -
Building151Equipment & Furniture -
Warehouse152Accumulated Depreciation - Equip & Furn. -
Warehouse153Equipment & Furniture - Office154Accumulated
Depreciation - Equip & Furn. - Office201Accounts
Payable202Wages Payable203Interest Payable204Dividends
Payable205Unearned Rent250Notes Payable251Bonds
16. Payable252Mortgage (Warehouse) Payable300Common Stock,
$1 Par, 100,000 Authorized; 60,000 shares
Issued/Outstanding301Paid In Capital - Excess of
Par330Retained Earnings340Treasury Stock500Sales510Sales
Discounts511Sales Returns & Allowances600Cost of Goods
Sold700Wage Expense (hourly workers)701Salaries Expense
(Exempt Staff)702Marketing Expense703Travel and
Entertainment Expense704Bad Debt Expense705Property Tax
Expense706Office Maintenance & Repair Expense707Legal
Expenses708Insurance Expense709Utilities Expense710Office
Supplies Expense711Telecommunications
Expense712Depreciation Expense - Equip & Furniture -
Warehouse713Depreciation Expense - Equip & Furniture -
Office800Rent Income900Interest ExpenseTotalNet Income
(Loss)Total
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Table 1AC Speed CorporationIncome Statement
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Table 1AC Speed CorporationStatement of Retained Earnings
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Table 1AC Speed CorporationBalance Sheet
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Table 1AC Speed CorporationPost-closing Trial BalanceFor
Month Ended June 30, 2010DEBITCREDITCashAccounts
ReceivableAllowance for Doubtful AccountsMerchandise
InventoryOffice SuppliesPrepaid
InsuranceLandBuildingAccumulated Depreciation -
BuildingEquipment & Furniture - WarehouseAccumulated
Depreciation - Equip & Furn. - WarehouseEquipment &
Furniture - OfficeAccumulated Depreciation - Equip & Furn. -
OfficeAccounts PayableWages PayableInterest
PayableDividends PayableUnearned RentNotes PayableBonds
17. PayableMortgage (Warehouse) PayableCommon Stock, $1 Par,
100,000 Authorized; 60,000 shares Issued/OutstandingPaid In
Capital - Excess of ParRetained EarningsTreasury StockTotal
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Table 1Dec. 31, 2010Dec. 31, 2009Dec. 31,
2008INDUSTRYLiquidityCurrent Ratio (One decimal
place)2.2000000000000002Acid Test Ratio (One decimal
place)1.5Receivables Turnover (One decimal place)10Inventory
Turnover (One decimal place)9.5ProfitabilityProfit Margin (%
with two decimal places)0.035000000000000003Asset Turnover
(two decimal places)1.8999999999999999Return on Assets (%
one decimal place)0.105Return on Common Shareholders'
Equity (One decimal place)0.183Earnings per Share (EPS) (Two
decimal places)3.0499999999999998Price-Earnings (P/E ) Ratio
(Two decimal places)14.800000000000001Payout Ratio (% One
decimal place)0.14999999999999999Solvency RatiosDebt to
Total Assets Ratio (% One decimal
place)0.42199999999999999Dec. 31, 2010Dec. 31, 2009Dec.
31, 2008Common Dividends192001613015000Weighted
Average Common Shares650006500063750Market Price per
Share353431INSTRUCTIONS: (also refer to the Instructions
tab in this workbook)Evaluate the company's performance trend
relative to liquidity, profitability and solvency.Evaluate the
company's performance relative to liquidity, profitability and
solvency for their industry for the three years.Use Word to
prepare a memo (500 word minimum) to AC Speed's
management, addressing the following questions:1. How
efficiently is AC Speed using its assets to produce sales? How
does it compare to other firms in the industry in this respect? 2.
Is AC Speed able to effectively leverage its profitability? Why
or why not?3. AC Speed's general manager mentioned that the
company may be seeking some additional bank financing (both
short- and long-term) in the near future. Explain how you think
the bankwill view the company's request, based on the evidence
of liquidity and solvency ratios.
