1. Describe the system of accounting standards and principles to utilize these in the preparation and communication of relevant financial information.
1. Describe the system of accounting standards and principles to utilize these in the preparation and communication of relevant financial information.
2. Apply the accrual method of accounting and the accounting cycle in preparation of financial statements
3. Prepare a
4. Apply generally accepted principles when accounting for cash dividends and preparation of
Assignment Description and Instructions
Suppose you are a part of a group of students from a prominent university and were sent out as a team to work with a leading merchandising company as a part of a work experience program. The team having been introduced to the general manager was told that the Accountant who normally prepares the financial statements has suddenly resigned and there is no one available to prepare the companyâ€s financial statements which are now due. As aspiring university students, you and your group members have expressed an interest in taking on the task. As a group, you are required to collaborate and analyze the problem at hand then apply the accrual basis of accounting in the preparation of the companyâ€s financial statements.
Scholes Shoes Ltd, is a retailer of childrenâ€s school shoes and they have produced the following Unadjusted
Scholes Shoes Ltd Unadjusted Trial Balance as at December 31, 2018 A/C Name D R CR Cash 1,000,000
The following additional information was made available on December 31, 2018
a) Insurance of $450,000 was paid on May 1, 2018 for the 10-months to February 2019
b) The furniture and fixtures have an estimated useful life of 10 years and is being depreciated on the straight-line method down to a residual value of $100,000.
c) The computer equipment was acquired on March 1, 2018 and is being depreciated over 10 years on the double-declining method of depreciation, down to a residue of $60,000.
d) Wages earned by employees NOT yet paid amounted to 15,000 at December 31, 2018.
e) A physical count of inventory at December 31, reveals $180,000 worth of inventory on hand.
f) At December 31, $140,000 of the previously unearned sales revenue had been earned.
h) The ageing of the Accounts Receivable schedule at December 31 indicated that the estimated uncollectible on account receivable should be $45,000
Required:
1. Prepare the necessary
2. Prepare the companyâ€s Multiple-step Income Statement for the year ended December 31, 2018.
3. Prepare the companyâ€s Statement of Ownerâ€s Equity for the year ended December 31, 2018
4. Prepare the companyâ€s classified Balance Sheet at December 31, 2018
5. Prepare the closing entries
6. Prepare the post-closing trial balance
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