ACCT 253 Introductory Financial Accounting – CASE STUDIES PART 1-7 Athabasca University

ACCT 253 Introductory Financial Accounting – CASE STUDIES PART 1-7 Athabasca University Part 1
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w1 [70 points]
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HackSoft Corp. is a small computer consulting business. The company is organized as a corporation and provides consulting services, computer system
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installations, and custom program development. HackSoft Corp. showed the following alphabetized post-closing trial balance at February 28, 2014.
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Account Balance
Accounts payable 29,000 w1 w 1




Accounts receivable 82,500 w1 w 1




Accumulated depreciation, building 4,500 w 1 w 1




Building 43,500
Cash __________________________________ 164,000
Retained earnings ________________________ 176,000
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Share capital _____________________________ 80,500
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Note:

There were 13,000 shares issued and outstanding on February28, 2014. Depreciation on
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the building is $700 per month.
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HackSoft Corp.'s salaries expense is a total of $800 per day for each work day (Monday-Friday) in the month (for simplicity, please ignore all statutory
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holidays).
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The following source documents are from March :
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Deposit slip (March 1) w1 w1 w1 Receipt 7909 w1 Invoice 6247 w1 Inter-OfficeMemo 3 w
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Purchase Order 6582 w1 w1 Receipt from Carrie's Diner w1 w1 w1 Invoice 6248 w1 Inter-OfficeMemo 4 w
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Inter-OfficeMemo 1 w
1 w1 Invoice 6246 w1 Inter-OfficeMemo 2 w
1 w1 Customer Statement for Sundown Co w
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Receipt 7904 w1 Receipt 7910 w1 Receipt 7912 w1 Inter-OfficeMemo 5 w
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Invoice 7437 w1 Receipt 7911 w1 OnPaceAdvertising Bill w
1 w1 Inter-OfficeMemo 6 w
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a) Analyze each of the preceding source documents and prepare journal entries using this information only. Note that some source documents may not
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require an entry. Also, all bills are recorded in the journal on the day they are received. Enter an appropriate description when entering the transactions in the
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journal. Dates must be entered in the format dd/mmm (ie. January 15 would be 15/Jan).
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General Journal w1 Page GJ1 w1 General Journal w1 Page GJ2 w1




Date Account/Explanation F Debit Credit Date Account/Explanation F Debit Credit
1/Mar Cash w1 30,000 4/Mar Food and Drinks Expense w1 w1 w1 63
Share Capital w1 w1 w 1 30,000 Cash w1 w1 63
sharesissued w
1 Client dinner w1




2/Mar Computers w 1 16,800 7/Mar Accounts Receivable w1 w 1 13,344
Accounts Payable w1 w1 w 1 16,800 Consulting Revenue Earned w1 w1 w1 13,344
computer cost w1 consultation services w
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1/Mar Prepaid Insurance w1 w 1 2,400 7/Mar Cash w1 348
Cash w1 w1 2,400 Consulting Revenue Earned w1 w1 w1 348
prepaidinsuramce w
1 consultation services w
1




1/Mar Repair Expense w1 w 1 100 9/Mar Cash w1 278
Cash w1 w1 100 Consulting Revenue Earned w1 w1 w1 278
repair consultation services w
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2/Mar Cash w1 11,200 10/Mar Accounts Receivable w1 w 1 11,136
Unearned Consulting Revenue w1 w1 w1 11,200 Consulting Revenue Earned w1 w1 w1 11,136
for unerned consulting revenue w1 w1 w1 consultation services w
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General Journal Page GJ3 w1 w1 General Journal w1 Page GJ4 w1




Date Account/Explanation F Debit Credit Date Account/Explanation F Debit Credit
11/Mar Accounts Receivable 18,904 w1 w 1 31/Mar Dividends w1 5,280
Consulting Revenue Earned 18,904
w1 w1 w1 Cash w1 w1 5,280
consultation services w
1
disbursment of shares w1 w1




2is5s/tM A d ver tisin g E x p en se
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, AccountsPayable w
1 700
advertising w1




25/Mar Salaries Expense w 1 w1 w 1 13,600
Cash w1 w 1 13,600
salaries
27/Mar Accounts Payable w 1 w1 w 1 16,800
Cash w1 w 1 16,800
computer bill w1




31/Mar Accounts Payable w 1 w1 w 1 700
Cash w1 w 1 700
advertisement bill w1




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Note that any incorrect entries are highlighted red, but there may also be some entries missing.
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b) What is the next step in the accounting cycle?
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Post transactionsw 1 w1




Prepare an unadjusted trial balance
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Prepare adjusting entries
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This is the last step
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Prepare closing entries
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Prepare an adjusted trial balance
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Prepare financial statements
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Prepare a post-closing trial balance
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Total marks for this question: 65
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Overall Mark: 65/70 w1 w1




Your markof 65/70 has been recorded.
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Youcan now move on to the next step, or you can try again to improve your grade on this step.
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DONE

, Part 2 [20 points]
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HackSoft Corp.'s March journal entries have been posted to the general ledger for you as shown below. This is similar to how an
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accounting software package posts automatically.
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Cash Account No.101 w
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Date Explanation F Debit Credit Balance
28/Feb Opening balance w1 164,000
1/Mar Issuedshares w
1 GJ1 30,000 194,000
1/Mar Prepaidfor insurance w
1 w1 GJ1 2,400 191,600
1/Mar Paidfor repairs to building
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w GJ1 100 191,500
2/Mar Receivedpaymentforconsultinginadvance
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1 1
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1 GJ1 11,200 202,700
4/Mar Paidfor dinner with client
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w GJ2 63 202,637
7/Mar Earnedandreceivedconsulting revenue
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w w1 w1 w1 GJ2 348 202,985
9/Mar Earnedandreceivedconsulting revenue
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1 1
w w1 w1 w1 GJ2 278 203,263
23/Mar Received customer payment w1 w 1 GJ3 13,344 216,607
25/Mar Paid cash for salaries
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w GJ3 13,600 203,007
27/Mar Paidinvoice for computers
w1 w1 w1 GJ3 16,800 186,207
31/Mar Paid bill for advertising expense
w1 w1 w1 w1 GJ4 700 185,507
31/Mar Dividends 1
w GJ4 5,280 180,227

AccountsReceivable 1
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Date Explanation F Debit Credit Balance
28/Feb Opening balance w1 82,500
7/Mar Earned consulting revenue
w1 w1 GJ2 13,344 95,844
10/Mar Earned consulting revenue
w1 w1 GJ2 11,136 106,980
11/Mar Earned consulting revenue
w1 w1 GJ3 18,904 125,884
23/Mar Received customer payment w1 w 1 GJ3 13,344 112,540

Prepaid Insurance w1 Account No.128 w
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Date Explanation F Debit Credit Balance
1/Mar Prepaidfor insurance w
1 w1 GJ1 2,400 2,400

Computers Account No.151 w
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Date Explanation F Debit Credit Balance
2/Mar Received computers w1 GJ1 16,800 16,800

Building Account No.173 w
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Date Explanation F Debit Credit Balance
28/Feb Opening balance w1 43,500

Accumulated Depreciation, Building w1 w 1 Account No.174 w
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Date Explanation F Debit Credit Balance
28/Feb Opening balance w1 4,500

AccountsPayable w
1 Account No.201 w
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Date Explanation F Debit Credit Balance
28/Feb Opening balance w1 29,000
2/Mar Received computers w1 GJ1 16,800 45,800
25/Mar Receivedbillforadvertisingexpense w
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1 GJ3 700 46,500
27/Mar Paidinvoice for computers
w1 w1 w1 GJ3 16,800 29,700
31/Mar Paid bill for advertising expense
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Unearned Consulting Revenue w1 w1 Account No.230 w
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Date Explanation F Debit Credit Balance
2/Mar Receivedpaymentforconsultinginadvance
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1 GJ1 11,200 11,200

ShareCapital w
1 Account No.301 w
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Date Explanation F Debit Credit Balance
28/Feb Opening balance w1 80,500
1/Mar Issuedshares w
1 GJ1 30,000 110,500

This study source was downloaded by 100000895080D2i7v6idfreonmdsCourseHero.com on 01-08-2025 02:56:04 GMT -06:00
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AccountNo. 302 1
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