Reference no: EM131492382
Financial Accounting Group Assignment
Course Learning Outcomes addressed:
- To demonstrate knowledge of broad business principles with depth of understanding of at least one business discipline.
- To develop effective oral and written communication skills.
- To develop the skills to demonstrate a broad understanding of business principles and demonstrate depth in at least one discipline.
- To develop the skills to allow the acquisition and synthesising of information within a complex professional setting.
- To develop and apply skills in critical thinking, complex problem solving and decision making.
- To develop and apply knowledge of the social, economic, ethical and cultural contexts of business.
- To develop and apply an understanding of independent as well as group learning.
Unit Learning Outcomes addressed:
a) Demonstrate an understanding of the accounting environment.
b) Show an ability to apply accounting vocabulary, principles and concepts.
c) Analyse transactions and prepare journals, ledgers and worksheets, and a Trial Balance.
d) Prepare general purpose financial statements.
e) Analyse, record, and report Current and non-current assets.
f) Distinguish between current and non-current liabilities, provisions and contingencies.
Assessment Task:
Assessment purpose - The assignment is designed to enhance students' skills in the preparation of simple financial statements, business transaction journalising as well as the implementation of an internal control system in a business. Standards of ethical conduct is also presented to facilitate students' discussion.
Part A:
Crazy Mountains Outfitters Co., an outfitter stores for fishing treks, prepared the following unadjusted trial balance at the end of its first year of operations:
Crazy Mountains Outfitters Co. Unadjusted Trial Balance April 30, 2019
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Debit Balances
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Credit Balances
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Cash
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11,400
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|
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Accounts receivables
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72,600
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|
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Supplies
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7,200
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|
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Equipment
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112,000
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|
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Accounts Payable
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12,200
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Unearned Fees
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19,200
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John Bridger, Capital
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137,800
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John Bridger, Drawing
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10,000
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|
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Fee Earned
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305,800
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Wages Expenses
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157,800
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|
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Rent Expenses
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55,000
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|
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Utilities Expenses
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42,000
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|
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Miscellaneous Expenses
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7,000
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|
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475,000
|
475,000
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For preparing the adjusting entries, the following data were assembled:
- Supplies on hand on April 30 were $1,380.
- Fees earned but unbilled on April 30 were $3,900.
- Depreciation of equipment was estimated to be $3,000 for the year.
- Unpaid wages accrued on April 30 were $2,475.
- The balance in unearned fees represented the April 1 receipt in advance for services to be provided. Only $14,140 of the services was provided between April 1 & April 30.
Instructions
1. Journalize the adjusting entries necessary on April 30, 2019.
2. Determine the revenues, expenses, net income of Crazy Mountain Outfitters Co. before the adjusting entries.
3. Determine the revenues, expenses, and net income of Crazy Mountain Outfitters Co. after the adjusting entries.
4. Determine the effect of the adjusting entries on John Bridger, Capital.
Part B: Analysis of the internal control system
1) The following data were gathered to use in reconciling the bank account of Conway Company:
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Balance as per bank
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$23900
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Balance as per Company records
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8,700
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Bank service charges
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50
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Deposit in Transit
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5,500
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Note collected by bank with $450 interest
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9,450
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Outstanding checks
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11,300
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What is the adjusted balance on bank reconciliation?
2) The following procedures were recently installed by China Shop:
- All sales rung up on the cash register, and a receipt is given to customer. All Sales are recorded on a record locked inside a cash register.
- Each cashier is assigned a separate cash register drawer to which no other cashier has access.
- At the end of a shift, each cashier counts the cash in his/her cash register, unblocks the cash register record, and compares the amount of cash with the amount on the record to determine the shortages and overages.
- The bank reconciliation is prepared by the cashier.
Instructions: Indicate whether each of the procedures of Internal control over cash represents (1) a strength or (2) a weakness. For each weakness, indicate why it exists.
Part C: Cases & Project
1) Read the following two cases and discuss in details whether or not the accountant acted ethically. Then, you must suggest a proper action/response that the accountant must have done otherwise
Tehra is an accountant for skeds, inc., footwear and Apparel Company. The company's revenue and the net income have increased by more than 100% over the past three years. During the same period, Tehra and her colleagues in accounting department have not received a raise or salary increase. Frustrated by not receiving a raise while the company has thrived, Tehra has begun submitting expense reimbursements of personal purchase. Tehra has a good relationship with her supervisors, and simply "sign off" on Tehra 's Expenses reimbursement. Tehra suspects that he knows she is submitting personal and is "looking the other way" because Tehra has not received a raise in the past last three years.
2) Rahul is an accounting manager for On Time Greeks, a tech support company for individuals and small business. As part of his job, Rahul is responsible for preparing the trial balance of company. His supervisor placed a "hard deadline" of Friday at 5.pm for the completion of Trial Balance. Unfortunately, Rahul was unable to balance the trial balance by due date. Credit side exceeded by $3000 from the debit side. To make the deadline, Rahul decided to add a $3000 debit to the vehicles account Balance. He selected the vehicles account because it will not be significantly affected by additional $3000.