The Accounting Cycle & Transaction Analysis final assessment involves analyzing and recording business transactions via journal entries, posting these journal entries to T-accounts, preparing a trial balance, journalizing and posting adjusting entries, and preparing an adjusted trial balance. In completing these tasks, you will demonstrate an understanding of the accounting cycle, accounting process and accrual concept, double-entry accounting, and the importance of GAAP. Items Required for Submission The item required for submission is a portfolio (titled: Preparing an Adjusted Trial Balance) of accounting cycle steps detailed in the following steps. Step ONE: Analyze and Record Business Transactions Use the information provided in Appendix A (Trial Balance for Purity Inc. and the list of the transactions that occurred during the month of June) to complete the following steps. The diagrams here are for illustration purposes only; use the Excel template to actually record the entries. 1) Journalize the transactions that occurred in June. Do not include explanations. Journal DATE ACCOUNTS Jun 1 POST. REF. Dr. Cr. Final Assessment: Outline and Rubric 1 Accounting Cycle & Transaction Analysis Final Assessment: Outline and Rubric Final Assessment: Outline and Rubric 2 2) Open the ledger accounts listed in the trial balance together with their beginning balances at May 31. Use the four-column account format as illustrated below. Enter “Bal” for the May 31 balance in the Item column. Post the journal entries to the ledger, create new ledger accounts as necessary, and omit posting references. Calculate the new account balances at June 30, 2014. Cash DATE ITEM POST. REF. DEBIT CREDIT BALANCE DEBIT CREDIT 3) Prepare the trial balance for Purity Water, Inc., at June 30, 2014. ?? Trial Balance June 30, 2014 ACCOUNT DEBIT CREDIT Accounting Cycle & Transaction Analysis Final Assessment: Outline and Rubric Step TWO: Prepare the Adjusted Trial Balance Use the templates in the Excel document to prepare the unadjusted trial balance for Purity Water, Inc., at June 30. Journalize and post the adjusting entries for June based on the following adjustment information. a) Supplies on hand, $200. b) Depreciation, $100 equipment, $75 furniture, $330 vehicles. c) Services performed but unbilled, $1,900. d) Accrued salaries, $550. DATE ACCOUNTS June 30 POST. REF. Dr. Cr. Prepare an adjusted trial balance for Purity Water, Inc., at the end of June. ?? Adjusted Trial Balance June 30, 2014 Unadjusted Trial Balance Adjustments ACCOUNT DEBIT CREDIT DEBIT CREDIT DEBIT CREDIT Final Assessment: Outline and Rubric 3 Accounting Cycle & Transaction Analysis Final Assessment: Outline and Rubric Step THREE: Understanding GAAP Answer the following questions using two real company examples. Record your responses in the same Excel document you used for Steps ONE and TWO. Why is U.S. GAAP so important to the capital market system in the United States? Use two real company examples in your answer. Why is there a push to accept International Financial Reporting Standards (IFRS) as the universal standards for financial accounting? Use a U.S. company and a non-U.S. company as examples in your answer and describe how they would feel about this move. Step FOUR: Complete Checklist for Submission Before you submit your work, check to see if you have met the criteria noted below. Did you: Clearly and accurately analyze accounting transactions with balanced journal entries? Clearly and accurately analyze T-accounts? Create an accurate and appropriately organized trial balance? Clearly and accurately analyze the transaction for the appropriate adjusting entry? Create an accurate and appropriately organized adjusted trial balance? Clearly and concisely analyze GAAP and tie your explanations to two real world companies? Ensure that each component of your portfolio is clearly constructed, well organized and presented, and facilitates viewer understanding? Do all of your entries contain the correct account titles, amounts, and appropriate debits and credits? Step FIVE: Submit Your Work [Leave this as the last step of the instructions. No changes are necessary to the text below; just delete these instructions.] ● Your completed files should be submitted through the Final Assessment page of your competency. List of Templates/Resources Needed Accounting Cycle & Transaction Analysis – Final Assessment Template o Located in the assessment description Final Assessment: Outline and Rubric 4
