Accounting- Journal Entries, Inventory Control, and Credits & Balances Assignment | Get Paper Help
Requires bookkeeping and a few pages of writing to shareholders. Need accounting numbers checked on excel sheet mainly
Portfolio Project (350 Points)
Important! Read First
Choose one of the following two Portfolio Project options to complete by the end of Week 8. Do not do both assignments. Identify your assignment choice in the title of your submission. When you are ready to submit, click the Week 8 Portfolio Project header on the Assignments page to upload the document.
In the narrative questions, your paper should be two to three pages in length total and conform to CSU-Global Guide to Writing and APA. (Links to an external site.) Include scholarly references as needed in addition to the course textbook to support your views. The CSU-Global Library is a good place to find these references.
Option #1: The Accounting Cycle and Stockholders’ Equity Analysis
Portfolio Project Option #1 is for accounting students who are sensing learners and learn best from concrete materials and examples. If this is your learning style preference, you are practical and careful with detail. For this assignment, you are required to complete Part 1, Part 2, and Part 3. You will present Parts 1 and 2 in Excel, and Part 3 of the Portfolio Project in a Word document, following the exact instructions that accompany each part. (The templates can be found in Module 8, and by clicking “Next” at the bottom of this page.)
Use the assignment templates are attached below.
Katy McCall opens a tax consulting business called Horizon Consultants Inc. and completes the following transactions in March:
March 1: As a sole shareholder, McCall invested $125,000 cash along with $45,000 of office equipment in the company.
March 2: Horizon Consultants Inc. completed services for a client and immediately received $4,000 cash.
March 3: Horizon made credit purchases for office equipment for $1,500 and office supplies for $2,100. Payment is due within 10 days.
March 6: Horizon Consultants Inc. pre-paid $6,000 cash for six months’ rent for their office.
March 10: Horizon completed a $4,250 project for a client who must pay within 45 days.
March 12: Horizon paid $3,600 cash to settle the account payable created on March 3.
March 19: Horizon paid a $6,000 cash premium on a 12-month insurance policy.
March 22: Horizon received $3,250 cash as a partial payment for the work completed on March 10.
March 25: Horizon completed work for another client for $4,250 on credit.
March 29: McCall paid herself a dividend of $3,000 cash.
March 30: Horizon purchased $750 of additional office supplies on credit.
March 31: Horizon paid $350 cash for this month’s utility bill.
Using the following chart of accounts and template, prepare journal entries for the above economic transactions. Include the effect that each transaction has on the accounting equation. Enter your journals to the general ledger using the same file name.
Chart of accounts: cash, office equipment, capital stock, prepaid rent, prepaid insurance, office supplies, accounts payable, consulting revenue, accounts receivable, dividend, utility expense.
The following unadjusted trial balance is for Groenke Construction Company as of year-end for the December 31, 20×7 fiscal year. The December 31, 20×6 credit balance of the stockholders’ equity account is $61,900, and the stockholders invested $45,000 cash in the company during 20×7.
- Account Title Debit Credit
101 Cash $15,000
126 Supplies $8,500
128 Pre-paid insurance $11,200
167 Equipment $175,000
168 Accumulated depreciation – equipment $19,000
201 Accounts payable $9,250
251 Long-term notes payable $45,000
301 Shareholders’ equity $106,900
302 Dividends $15,750
401 Construction Revenue $153,000
623 Wage expense $61,800
633 Interest expense $6,250
640 Rent expense $15,750
683 Property tax expense $12,500
684 Repairs expense $6,100
690 Utilities expense $5,300
TOTALS $333,150 $333,150
Use the template provided to:
- Journalize the following adjusting entries as of fiscal year-end December 31, 20×7.
- Post the adjusting entries to an unadjusted trial balance and prepare the adjusted trial balance.
- Create financial statements, namely: i) the income statement, ii) statement of stockholders’ equity, and iii) the balance sheet for 20×7.
- The supplies available at the end of the fiscal year 20×7 are at a cost of $5,700.
- The company’s employees have earned $3.500 in accrued wages for the fiscal year.
- The cost of expired insurance for the fiscal year is $8,600.
- The rent expense not yet paid or recorded in the fiscal year is $2,250.
- Annual depreciation on equipment is $8,000; no other depreciation adjustment was made in 20×7.
- The $450 accrued interest for December has not yet been paid and reported.
- Additional property taxes of $625 have been assessed for the fiscal year but have not yet been paid or recorded in the accounts.
- The December utilities expense of $425 is not included in the adjusted trial balance, because the bill arrived after the trial balance was prepared. The $425 amount owed needs to be recorded.
- The company paid dividends of $15,575 to its shareholders on record.
Assume you are the chief accountant making a presentation during the stockholders’ annual meeting for your corporation. Provide a brief explanation to stockholders on each of the following questions:
- In what ways can shares be “preferred”? In which ways are they similar and different from common shares? Give real-world examples.
|ACT300 Mod 8 PP|
|This criterion is linked to a Learning OutcomeContent||60.0 to >48.0 pts Meets Expectation Demonstrates strong or adequate knowledge of journal entries, trial balances, financial statements, and analysis; correctly represents knowledge from the readings and sources. 48.0 to >36.0 pts Approaches Expectation Some significant but not major errors or omissions in demonstration of knowledge. 36.0 to >24.0 pts Below Expectation Major errors or omissions in demonstration of knowledge. 24.0 to >0 pts Limited Evidence Fails to demonstrate knowledge of the materials.||60.0 pts|
|This criterion is linked to a Learning OutcomeRequirements||40.0 to >32.0 pts Meets Expectation The Portfolio includes all of the required components, as specified in the assignment. 32.0 to >24.0 pts Approaches Expectation The Portfolio includes most of the required components, as specified in the assignment. 24.0 to >16.0 pts Below Expectation The Portfolio includes some of the required components, as specified in the assignment. 16.0 to >0 pts Limited Evidence The Portfolio includes few of the required components, as specified in the assignment.||40.0 pts|
|This criterion is linked to a Learning OutcomeSynthesis and Evaluation||70.0 to >56.0 pts Meets Expectation Demonstrates strong or adequate synthesis and evaluation of course concepts in accounting. 56.0 to >42.0 pts Approaches Expectation Some significant but not major errors or omissions in synthesis and evaluation. 42.0 to >28.0 pts Below Expectation Major errors or omissions in synthesis and evaluation. 28.0 to >0 pts Limited Evidence Fails to demonstrate synthesis and evaluation.||70.0 pts|
|This criterion is linked to a Learning OutcomeCritical Analysis||70.0 to >56.0 pts Meets Expectation Demonstrates strong or adequate critical analysis of the case studies in terms of accounting and practice; provides strong or adequate thought and insight. 56.0 to >42.0 pts Approaches Expectation Some significant but not major errors or omissions in critical analysis. 42.0 to >28.0 pts Below Expectation Major errors or omissions in critical analysis. 28.0 to >0 pts Limited Evidence Fails to demonstrate critical analysis.||70.0 pts|
|This criterion is linked to a Learning OutcomeSources||20.0 to >16.0 pts Meets Expectation Cites and integrates at least 4 credible sources. 16.0 to >12.0 pts Approaches Expectation Cites and integrates 3 credible sources. 12.0 to >8.0 pts Below Expectation Cites and integrates 2 credible source. 8.0 to >0 pts Limited Evidence Cites and integrates no credible sources.||20.0 pts|
|This criterion is linked to a Learning OutcomeApplication of Source Material||30.0 to >24.0 pts Meets Expectation Sources well or adequately chosen to provide substance and perspectives on the issue; knowledge from the course linked properly to source material. 24.0 to >18.0 pts Approaches Expectation Some significant but not major problems with selection and linkage of sources. 18.0 to >12.0 pts Below Expectation Major problems with selection and linkage of sources. 12.0 to >0 pts Limited Evidence Source selection is seriously flawed; no linkage to knowledge from the course.||30.0 pts|
|This criterion is linked to a Learning OutcomeOrganization||20.0 to >16.0 pts Meets Expectation Project is clearly organized, well written, and in proper essay format including an introduction, body, and conclusion. Conforms to project requirements. 16.0 to >12.0 pts Approaches Expectation Small number of significant but not major flaws in organization and writing; is in proper essay format. In a minor way does not conform to project requirements. 12.0 to >8.0 pts Below Expectation Major problems in organization and writing; does not completely follow proper essay format. In a significant way does not conform to project requirements. 8.0 to >0 pts Limited Evidence Project is not well organized or well written and is not in proper essay format. Does not conform to project requirements.||20.0 pts|
|This criterion is linked to a Learning OutcomeGrammar and Style||20.0 to >16.0 pts Meets Expectation Strong sentence and paragraph structure; few or no minor errors in grammar and spelling; appropriate writing style; clear and concise with no unsupported comments. 16.0 to >12.0 pts Approaches Expectation Small number of significant but not major errors in grammar and spelling; generally appropriate writing. 12.0 to >8.0 pts Below Expectation Inconsistent to inadequate sentence and paragraph development; work needed on grammar and spelling; does not meet program expectations. 8.0 to >0 pts Limited Evidence Poor quality; unacceptable in terms of grammar and/or spelling; inappropriate writing style that interferes with clarity.||20.0 pts|
|This criterion is linked to a Learning OutcomeDemonstrates proper use of APA style||20.0 to >16.0 pts Meets Expectation Project contains proper APA formatting, according to the CSU-Global Guide to Writing & APA, with no more than one significant error. 16.0 to >12.0 pts Approaches Expectation Few errors in APA formatting, according to the CSU-Global Guide to Writing & APA, with no more than two to three significant errors. 12.0 to >8.0 pts Below Expectation Significant errors in APA formatting, according to the CSU-Global Guide to Writing & APA, with four to five significant errors. 8.0 to >0 pts Limited Evidence Numerous errors in APA formatting, according to the CSU-Global Guide to Writing & APA, with more than five significant errors.||20.0 pts|
|Total Points: 350.0|
- How does the book value of shares of stock differ from the market value of shares of stock? Use a real-world example in your answer.
- Discuss at least three main issues a board of directors considers when making a dividend declaration decision.
- How does a share dividend differ from a share split?
e) Explain why companies place restrictions on some of their retained earnings.
Reminder: Your Part 3 paper should be two to three pages in length total and conform to CSU-Global Guide to Writing and APA (Links to an external site.). Include scholarly references as needed in addition to the course textbook to support your views. The CSU-Global Library (Links to an external site.) is a good place to find these references.
ACT300 Mod 8 PP
The kind of shares issued by a company depends on the structure of the business. A business can be a C corporation or an S corporation. There are two types of stock issued by a company: common and preferred. Each class carry its financial terms and shareholder rights. Therefore, companies issue these shares depending on how they want to handle dividends and whether they want shareholders to be involved in the running of the company.
Preferred stock is a more stable investment venture. This is because shareholders are given an assurance of a consistent dividend payments that is not essentially affected by market price, unlike it is with the price of common stock. Preference stockholders get priority when a company pays dividends. When a company is dissolved, preference shareholders are given a priority in distribution of assets of a company. Common stockholders only receive company’s assets from such a delivery after preferred stockholders have been fully compensated. Common stockholders, however, have voting rights which preferred stockholders don’t enjoy.
Both kinds of stocks involve very high risks despite the high returns earned. If a company collapses, stocks become worthless regardless of their type. Stocks represent ownership in a company, and they both pay dividends. Mitcham Industries is an excellent example of a company issues common and 9% cumulative preference shares.
The book value of a share of stock can be obtained by subtracting the value of assets from liabilities. The answer obtained is then divided by the amount of shares allotted by a company. The market value of shares of stock is simply the amount of money an investor would pay to buy the stock of a company. For instance, the current market value of a share of stock of Bonny Worldwide Ltd is $73.25while the book value per share of stock is valued at $27.97.
The board of directors must make a tough decision to divide a company’s profits. They have to decide how much pay the shareholders in the form of dividends and other uses in the company. The amount of dividend paid also communicates a lot to existing investors, potential investors and competitors.
The board of directors must consider several factors before giving out cash dividends. Dividends reduce the amount of money left to make investments. Therefore, the board of directors must decide whether to spend more money on dividend payout use the money to invest. The investment should return amounts higher than the value of the investment. Also, a decision has to be made on whether to spend profits on dividends or to lower the corporate cost structure in ways such as paying out debts, restructuring operations and improving the company’s long term health. The business community watches the actions of the board of directors very closely. Therefore, a drastic change in a company’s dividend policy might send out the wrong signals. For instance, a sharp increase in dividends might drive the stock price higher, which might be an unintended consequence.
Dividend are mostly paid inform of cash and when they are paid in form of additional shares, this is referred to as share dividend. This is mostly done when a company experiences a shortage of cash flow. A share split is a division already issued shares into a proportion agreed upon by the company. A share split is mostly done to bring down the market price of the shares. (Stock Dividend Vs Stock Split, 2019)
Restricted retained earnings are the portion of a company’s reserved income that should not be distributed to shareholders as dividends. Reserved earnings are mostly delimited when a company fails to pay dividend payments that were due in the past. The amount restricted declines as dividends are paid out to shareholders. Restriction on retained earnings may also be placed when a lender restricts a company from paying a dividend until a loan has been paid off, thereby improving the chances of loan repayment.
Bank, Eric. (n.d.). What Factors Should a Board of Directors Consider When Giving Cash Dividends? Small Business. Retrieved from: http://smallbusiness.chron.com/factors-should-board-directors-consider-giving-cash-dividends-75003.html
Stock Dividend Vs Stock Split. Retrieved from: https://www.educba.com/stock-dividend-vs-stock-split/