InstructionsCASE STUDY 1THE COMPLETE ACCOUNTING CYCLEName: ___Regina Varnado________________________________

The entire Case Study is due Sunday at midnight mountain time at the end of Week 3.This Case Study is worth 100 points or 10% of your final course grade.

This Case Study relates to TCOs D and E and Chapters 3 and 4.

MAKE SURE TO COMPLETE ALL REQUIREMENTS WHICH ARE LISTED BELOW.

There are 10 sheets in the Workbook including this one.All of the Information you need for the project is located in this Workbook.

RequirementsSheet in WorkbookRequirement 1Prepare the Journal Entries in the General JournalJournal EntriesRequirement 2Post Journal Entries to the General LedgerGeneral LedgerRequirement 3Prepare a Trial BalanceTrial BalanceRequirement 4Prepare the Adjusting EntriesAdjusting EntriesRequirement 5Post Adjusting Entries to the General LedgerGeneral LedgerRequirement 6Prepare an Adjusted Trial BalanceAdjusted TBRequirement 7Prepare the Financial StatementsFinancial StatementsRequirement 8Prepare the Closing EntriesClosing EntriesRequirement 9Post Closing Entries to the General LedgerGeneral LedgerRequirement 10Prepare the Post Closing Trial BalancePost Closing TBHint for success: Review the Week 2 Lecture prior to starting this project.There are also hints contained within certain cells on some of the worksheet tabs. You can hover over the red pointer at the top right-hand corner of the cell to read the hint.Hints are provided for the following balances:1) The debits for the journal entries are on the Journal Entries tab.2) The credits for the journal entries are on the Journal Entries tab.3) The cash balance is on the General Ledger tab.4) The debits for the trial balance are on the Trial Balance tab.5) The credits for the trial balance are on the Trial Balance tab.6) The debits for the adjusted trial balance are on the Adjusted Trial Balance tab.7) The credits for the adjusted trial balance are on the Adjusted Trial Balance tab.8) Net income for the income statement is on the Financial Statements tab.9) Retained earnings as of March 31 are on the Financial Statements tab.10) Total assets for the balance sheet are on the Financial Statements tab.11) Total liabilities and shareholders' equity for the balance sheet are on the Financial Statements tab.12) The debits for the post-closing trial balance are on the Post-Closing Trial Balance tab.13) The credits for the post-closing trial balance are on the Post-Closing Trial Balance tab.

Journal EntriesRequirement #1:During its first month of operation, the Flower Landscaping Corporation, which specializes in residential landscaping,completed the following transactions.March 1Began business by making a deposit in a company bank account of $72,000, in exchangefor 7,200 shares of $10 par value common stock.March 1Paid the current month's rent, $4,500.March 1Paid the premium on a 1-year insurance policy, $3,300.March 7Purchased supplies on account from Parkview Company, $900.March 10Paid employee salaries, $2,200.March 14Purchased equipment from Hammond Company, $9,000. Paid $1,500 down and the balance wasplaced on account. Payments will be $375.00 per month for 20 months. The first payment is due 4/1.Note: Use accounts payable for the balance due.March 15Received cash for landscaping revenue for the first half of March, $4,896.March 19Made payment on account to Parkview Company, $450.March 31Received cash for landscaping revenue for the last half of March, $5,304.March 31Declared and paid cash dividend of $1,000.Prepare journal entries to record the March transactions in the General Journal below.Use the following account names for journal entries.General JournalChart of Accounts: Account Title (Normal Balance)DateDescription(Account Name)DebitCredit1-MarCash72,000AssetsCommon Stock72,000Cash (Debit)Issued common stockPrepaid Insurance (Debit)1-MarRent Expense4,500Supplies (Debit)cash4,500Equipment (Debit)Paid month rentAccumulated Depreciation-Equipment (Credit)1-MarPrepaid Insurance3,300cash3,300LiabilitiesPaid Insurance 1 year premiumAccounts Payable (Credit)7-MarSupplies900Income Tax Payable (Credit)Account Payable900Purchased supplies at ParkviewStockholders' Equity10-MarSalaries Expense2,200Common Stock (Credit)cash2,200Retained Earnings (Credit)Paid employee salariesDividends (Debit)14-MarEquipment9,000cash1,500RevenueAccount Payable7,500Landscaping Revenue (Credit)Purchased equipment at Hammond15-MarLandscaping Revenue4,896ExpensesCash4,896Rent Expense (Debit)Landscaping RevenueSalaries Expense (Debit)19-MarAccount Payable450Insurance Expense (Debit)Cash450Supplies Expense (Debit)Payment to Parkview CompnayDepreciation Expense (Debit)31-MarLandscaping Revenue5,304Income Tax Expense (Debit)cash5,304Landscaping Revenue31-MarDividends1,000Cash1,000Declared and paid cash dividend

103,550
DeVry: Debits equal $103,550103,550
DeVry: Credits equal $103,550

Note: Remember that debits must equal creditsAll of your journal entries should balance.

General LedgerThis Sheet will be used for Requirements 2, 5, and 9Requirement #2:Post the March journal entries to the following T-accounts and compute ending balances.

Cash (111)
DeVry: The balance of the Cash account after posting all journal entries should be $69,250.Landscaping Revenue (411)720004500DRCR48963300102004896530422005304150045010200102001000Closed

69250Debit Balance

Prepaid Insurance (117)Rent Expense (511)DRCRDRCR330027545004500

3025Debit Balance45004500Closed

Supplies (119)Salaries Expense (512)DRCRDRCR90045022002200

450Debit Balance22002200Closed

Equipment (144)Insurance Expense (513)DRCRDRCR9000275275

2752759000Debit BalanceClosed

Accumulated Depreciation-Equipment (145)Supplies Expense (514)DRCRDRCR150450450

450450150Credit BalanceClosed

Accounts Payable (212)Depreciation Expense (515)DRCRDRCR45075001501509001501507950Credit BalanceClosed

Income Tax Payable (213)Income Tax Expense (516)DRCRDRCR795795795

795Credit Balance795795ClosedCommon Stock (311)DRCR72000

72000Credit Balance

Retained Earnings (312)DRCR10001855

1855Credit Balance

Dividends (313)DRCR10001000

10001000Closed

Trial BalanceRequirement #3:Prepare a trial balance for March in the space below.Flower Landscaping CorporationTrial BalanceMarch 31

Account NameDrCrCash69,250Prepaid Insurance3,300Supplies900Equipment9,000Accumlated Depreciation EquipmentAccounts Payable7,950Income Taxes PayableCommon Stock72,000Landscaping Revenue10,200Rent Expense4,500Salaries Expense2,200Insurance ExpenseIncome Tax ExpenseInterest ExpenseCash Dividends1,00090,150
DeVry: Debits equal $90,150

90,150
DeVry: Credits equal $90,150

Adjusting EntriesRequirement #4: Prepare adjusting entries using the following information in the General Journalbelow. Show your calculations!a) One month's insurance has expired.b) The remaining inventory of supplies is $475.c) The estimated depreciation on equipment is $150.d) The estimated income tax is $795.General JournalDateDescription(Account Name)DebitCreditaPrepaid Insurance275Insurance Expense275

bSupplies425Supplies425

cDepeciation Expense150Accumulated Depreciation150

dIncome Tax Expense795Income Tax Payable795

Requirement #5:

Post the adjusting entries to the General Ledger T-accounts and compute adjusted balances.Just add to the balances that are already listed.

Adjusted TBRequirement #6: Prepare an adjusted trial balance in the space below.Flower Landscaping CorporationAdjusted Trial BalanceMarch 31

Cash69250Prepaid Insurance3025Supplies475Equipment9000Accumulated Depreciation Equipment150Accounts Payable7950Income Tax Payable795Common Stock72000Landscaping Revenue10200Rent Expense4500Salaries Expense2200Insurance Expense150Supplies Expense425Depreciation Expense795Income Tax PayableInterest Expense275Dividends100091095
DeVry: Debits equal $91,09591095
DeVry: Credits equal $91,095

Financial StatementsRequirement #7:Prepare the financial statements for the Flower Landscaping Corporation as of March 31 in the space below.You will only be preparing the income statement, statement of retained earnings, and the balance sheet.The statement of cash flows is a required financial statement, but is not required for this project.Flower Landscaping CorporationFlower Landscaping CorporationFlower Landscaping CorporationIncome StatementStatement of Retained EarningsBalance SheetFor the Month Ending March 31For the Month Ending March 31March 31

Revenues:Retained Earnings, March 1Assets:Landscaping Revenue$10,200Add: Net Income1,855Cash69,250SubtotalPrepaid Insurance3,025Expenses:Less: Dividends1,000Supplies475Rent Expense4,500Retained Earnings, March 31$855
DeVry: Retained Earnings equals $855Equipment9,000Salaries Expense2,200Less: Accum. Depr.150Insurance Expense275Total Assets81,600
DeVry: Total assets equals $81,600

Supplies Expense425Depreciation Expense150Liabilities:Income Tax Expense795Accounts Payable7,950 Total Expenses8,345Income Tax Payable795Total Liabilities8,745Net Income$1,855
DeVry: Net Income equals $1,855Stockholders' Equity:Common Stock72,000Retained Earnings855Total Stockholders' Equity72,855Total Liabilities and Stockholders' Equity$81,600
DeVry: Total Liabilities & Stockholders' Equity equals $81,600

Closing EntriesRequirement #8:Prepare the closing entries at March 31 in the General Journal below.Hint: Use the balances for each account, which appear on the AdjustedTrial Balance for your closing entries.

General JournalDateDescription (Account Name)DebitCredit31-MarService Revenue10200Income Summary10200

31-MarIncome Summary8345Rent Expense4500Salaries Expense2200Insurance Expense275Supplies Expense425Depreciation Expense150Income Tax Expense795

31-MarIncome Summary1855Retained Earning1855

31-MarRetained Earning1000Dividends1000

Requirement #9:

Post the closing entries to the General Ledger T-accounts and compute ending balances.Just add to the adjusted balances already listed.

Post Closing TBRequirement #10:Prepare a post-closing trial balance as of March 31 in the space below.Flower Landscaping CorporationPost-Closing Trial BalanceMarch 31

Cash69,250Equipment9,000Supplies475Accounts Payable7,950Common Stock72,000Accumulated Depreciation150Prepaid Insurance3,025Income Tax Payable795Retained Earnings855

81,750
DeVry: Debits equal $81,75081,750
DeVry: Credits equal $81,750

Grading RubricCase Study 1 Rubric Please note that this rubric provides a general guideline but you can score anywhere between 0 and the maximum number of points for that step depending on the accuracy and completenessof your work.CriteriaOutstandingGoodPoorVery PoorPoints Awarded

Step 1 Prepared Journal Entries (20 points)Journal entries use accurate accounts and amounts; and debits and credits are used correctly. Minor errors such as incorrect account names or credits listed prior to debits.Errors in computations that resulted in incorrect amounts to be debited and credited.Evidence of an attempt to complete the journal entries.20 points16 points12 points8 pointsStep 2 Posted to the General Ledger (10 points)Posting is correct, leading to accurate account balances.Posting is mostly correct but minor errors are evident.Posting has several errors that resulted in incorrect account balances.Posting is done poorly but does show evidence of an attempt to complete.10 points8 points6 points4 pointsStep 3 Prepared a Trial Balance (10 points)Correct account names and balances that arrive at a correct trial balance. Some minor errors such as incorrect account names or incorrect totals due to errors in prior steps.Errors in computations that resulted in incorrect amounts to be debited and credited.Evidence of an attempt to complete the trial balance.10 points8 points6 points4 pointsStep 4 Prepared Adjusting Journal Entries (10 points)Journal entries use accurate accounts and amounts; and debits and credits are used correctly. Journal entries mostly use accurate accounts; and amounts and debits and credits are used correctly.Journal entries have some errors in use of accounts and amounts; and debits and credits are only somewhat used correctly.Journal entries have some errors in use of accounts and amounts; and debits and credits are not used correctly.10 points8 points6 points4 pointsSteps 5 & 6 Posted and Prepared an Unadjusted Trial Balance (10 points)Posting is correct, leading to an accurate trial balance.Posting is mostly correct, leading to a mostly correct trial balance.Posting has several errors, leading to a trial balance with several errors.Posting is done poorly or not at all, leading to inaccurate or no trial balance.10 points8 points6 points4 pointsStep 7 Prepared Financial Statements (20 points)All three Financial Statements are prepared accurately and in an appropriate format.Two of the three Financial Statements are prepared accurately and mostly in an appropriate format, one statement has some errors.One of the three Financial Statements is prepared accurately and mostly in an appropriate format; two statements have some errors.One or fewer of four Financial Statements are prepared accurately and mostly in an appropriate format; three or all statements have some errors.20 points16 points12 points8 pointsStep 8 Prepared Closing Journal Entries (10 points)Journal entries use accurate accounts and amounts; and debits and credits are used correctly. Journal entries mostly use accurate accounts and amounts; and debits and credits are used correctly.Journal entries have some errors in use of accounts and amounts; and debits and credits are only somewhat used correctly.Journal entries have some errors in use of accounts and amounts; and debits and credits are not used correctly.10 points8 points6 points4 pointsSteps 9 & 10 Posted and Prepared Post-Closing Trial Balance (10 points)Posting is correct, leading to an accurate trial balance.Posting is mostly correct, leading to a mostly correct trial balance.Posting has several errors, leading to a trial balance with several errors.Posting is done poorly or not at all, leading to inaccurate or no trial balance.10 points8 points6 points4 pointsTotal Points Earned Out of 100 Points0

Sheet1