Scenario 

You were recently hired as an entry-level bookkeeper for a service business that recently opened. This is the first month in operation for the business and your first task is to record business transactions for their first month using the source documents and transaction data the owner will provide to you. Because this is a small business that does not use computerized accounting, you will apply the accounting cycle in Excel to record transactions and generate financial reporting results for the owner. 

Milestone One Guidelines and Rubric 

 
Focus 

Overview 

In previous modules, you examined the initial stages of the accounting cycle and practiced journalizing financial transactions. In Milestone One, you will complete the first part of your course project to demonstrate your ability to accurately record financial data, which will continue to be used to complete other parts of the project. 

Scenario 

You were recently hired as an entry-level bookkeeper for a service business that recently opened. This is the first month in operation for the business and your first task is to record business transactions for their first month using the source documents and transaction data the owner will provide to you. Because this is a small business that does not use computerized accounting, you will apply the accounting cycle in Excel to record transactions and generate financial reporting results for the owner. 

Prompt 

Record Financial Data: Use accepted accounting principles to accurately capture business transactions for the month in the

Company Accounting Workbook Template
using the data provided in the

Accounting Data Appendix
document. 

Specifically, you must address the following rubric criteria: 

·
Accuracy: Prepare entries that are accurate in that they fully reflect the appropriate information.  

·
Completeness: Prepare entries that are complete for each month, including transferring posted entries to T accounts.  

·
Unadjusted Trial Balance: Prepare the unadjusted trial balance portion of the “Trial Balance” tab of the company accounting workbook, ensuring that the total debits and credits match.  

Guidelines for Submission 

Using the provided template, submit your company accounting workbook with the following portions completed: the General Journal tab, the Ledger Accounts tab, and the Trial Balance tab. This should be completed and submitted using the Microsoft Excel workbook template. Please note that the first tab of the workbook provides you with the chart of accounts. These are the accounts you will use in recording transactions for the month. 

Supporting Materials 

The following resources support your work on the project: 

Video:

Milestone One Walkthrough
(14:40)   

This video walkthrough is available if you need additional assistance completing this milestone. The video uses a sample data set for illustrative purposes.  

A video transcript is available:

Transcript for ACC 201 Milestone One Walkthrough
 

Milestone One Rubric 

Criteria 

Exemplary (100%) 

Proficient (85%) 

Needs Improvement (55%) 

Not Evident (0%) 

Value 

Accuracy 

Prepares accurate entries with no errors  

Prepares accurate entries with minimal errors  

Prepares entries that have significant inaccuracies  

Does not attempt criterion 

35 

Completeness 

Prepares entries that are complete for each month, including transferring posted entries to T accounts, with no errors  

Prepares entries that are complete for each month, including transferring posted entries to T accounts, with minimal errors  

Prepares entries that are complete for each month, including transferring posted entries to T accounts, with significant errors  

Does not attempt criterion 

35 

Unadjusted Trial Balance  

Prepares the unadjusted trial balance accurately, ensuring the total debits and credits match with no errors  

Prepares the unadjusted trial balance with minimal errors  

Prepares the unadjusted trial balance with significant errors  

Does not attempt criterion 

30 

Total: 

100% 

 


2

Chart of Accounts

This chart of accounts should help you identify the appropriate accounts to record to as you are analyzing and journaling transactions for this workbook. There is nothing to complete on this page; this is simply a resource for you.
Asset Accounts Liability Accounts Equity Accounts
Acct # Acct # Acct #
Cash 101 Notes Payable 201 Owner’s Capital 301
Accounts Receivable 102 Accounts Payable 202 Owner Draws 302
Prepaid Rent 103 Wages Payable 203
Office Furniture 104
Office Supplies 105
Accumulated Depreciation (contra asset) 106
Revenue Accounts
Acct #
Service Revenue 401
Expense Accounts
Acct #
Rent expense 501
Business License Expense 502
Insurance Expense 503
Repairs and Maintenance 504
Advertising Expense 506
Wages Expense 507
Utilities Expense 508
Depreciation Expense 509
Cash
Baking Supplies
Prepaid Rent
Prepaid Insurance
Baking Equipment
Office Supplies
Accounts Receivable
Accumulated Depreciation
Merchandise Inventory
Notes Payable
Accounts Payable
Wages Payable
Interest Payable
Common Stock
Dividends
Bakery Sales
Merchandise Sales
Baking Supplies Expense
Rent Expense
Insurance Expense
Misc. Expense
Business License Expense
Advertising Expense
Wages Expense
Telephone Expense
Interest Expense
Depreciation Expense
Office Supplies Expense
Cost of Goods Sold

General Journal

A Company
General Journal Entries Journal Entry Tips
The debited account is recorded first, credited account recorded second.
Debits and credits must always equal!
Date Accounts Debit Credit There can be compound entries in which two accounts receive a debt to an equivalent credited amount to one account.
Be sure to use your chart of accounts (the first page of this workbook).
Each account you will record to is already listed and organized by classification of the account.
Total – 0 – 0 If Red, this means your debits and credits do not equal. Be sure to review for errors.

Ledger Accounts

Assets Liabilities Equity Revenue Expenses
Cash Notes Payable Owner’s Capital Service Revenue Rent Expense
$ – 0 $ – 0 $ – 0 $ – 0 $ – 0 $ – 0 $ – 0 $ – 0 $ – 0 $ – 0
$ – 0 $ – 0 $ – 0 $ – 0 $ – 0
Accounts Rec. Accounts Payable Owner Draws Business License Expense
$ – 0 $ – 0 $ – 0 $ – 0 $ – 0 $ – 0 $ – 0 $ – 0
$ – 0 $ – 0 $ – 0 $ – 0
Prepaid Rent Wages Payable Insurance Expense
Posting to the ledger/t accounts
Don’t overthink it!
You are just posting each debit and credit from the journal entries to the account you identified in the entry.
These accounts are set to calculate your balances for you.
Please be careful not to delete the running totals as those will calculate the ending balance.
The ending balance will transfer to the Trial Balance sheet.
If you have posted all entries and your trial balance is not in balance (total debits = total credits),
$ – 0 $ – 0 $ – 0 $ – 0 this means that there is an error. $ – 0 $ – 0
$ – 0 $ – 0 $ – 0
Office Furniture Repairs & Maint.
$ – 0 $ – 0 $ – 0 $ – 0
$ – 0 $ – 0
Office Supplies Advertising Expense
$ – 0 $ – 0 $ – 0 $ – 0
$ – 0 $ – 0
Accumulated Depreciation Wages Expense
$ – 0 $ – 0 $ – 0 $ – 0
$ – 0 $ – 0
Utilities Expense
$ – 0 $ – 0
$ – 0
Depreciation Expense
$ – 0 $ – 0
$ – 0

Trial Balance

Trial Balance
As of 03/31/20XX
Unadjusted trial balance
Account Debit Credit Trial Balance
Cash – 0 Balances from the t accounts will autofill your trial balance.
Accounts Receivable – 0 If total debits do not equal total credits in the trial balance, you know you have an error.
Prepaid Rent – 0 These are the balances that will be used to prepare the financial statements.
Office Furniture – 0 Be sure to implement feedback provided by your instructor for this Milestone One submission!
Office Supplies – 0
Accumulated Depreciation – 0
Notes Payable – 0
Accounts Payable – 0
Wages Payable – 0
Owner’s Capital – 0
Owner Draws – 0
Service Revenue – 0
Rent Expense – 0
Business License Expense – 0
Depreciation Expense – 0
Insurance Expense – 0
Repairs and Maintenance Expense – 0
Advertising Expense – 0
Wages Expense – 0
Utilities Expense – 0
Retained Earnings
Total: – 0 – 0
Debits should equal credits
`

Income Statement

A Company
Income Statement
For Month ending 3/31/20XX
Revenues
Total Revenues $ – 0
Operating Expenses:
Total Operating Expenses: – 0
Net Income – 0

Statement of Stockholder Equity

Company Name
Statement of Owner’s Equity
Period Ending 03/31/20XX
Beginning Capital on 3/01/20XX $ – 0
Increases to capital
Net income/loss:
Owner Contributions
Subtotal: $ – 0
Decreases to capital
Owner Draws
Ending Equity as of 03/31/20XX $ – 0

Balance Sheet

A Company
Balance Sheet
As of March 31, 20XX
Assets Liabilities and Owners’ Equity
Current Assets: Current Liabilities:
Total Current Liabilities – 0
Long Term Liabilities:
Total Current Assets – 0 Total Long Term Liabilities: – 0
Total Liabilities: – 0
Owner’s Equity
Non-Current Assets:
Total Equity – 0
Total Non Current/Fixed Assets – 0
Total Assets: – 0 Total Liabilities & Equity – 0 <== Total Assets on the left should equal Liabilities + Owner’s Equity on the right.

Closing Entries

A Company
Closing Entries
Month ending 03/31/20XX
Date Accounts Debit Credit
31-Mar
Close revenues
31-Mar
Close Expenses
31-Mar
Close Income Summary
31-Mar
Close Dividends
– 0 – 0

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ACC 201 Accounting Data Appendix

The following events occurred in March:

·
March 1: Owner borrowed $125,000 to fund/start the business. The loan term is 5 years.

·
March 1: Owner paid $250 to the county for a business license.

·
March 2: Owner signed lease on office space; paying first (March 20XX) and last month’s rent of $950 per month.

· March 5: Owner contributed office furniture valued at $2,750 and cash in the amount of $15,000 to the business.

·
March 6: Owner performed service for client in the amount of $650. Customer paid in cash.

· March 8: Owner purchased advertising services on account in the amount of $500.

· March 10: Owner provided services to client on account, in the amount of $1,725.

· March 15: Owner paid business insurance in the amount of $750.

·
March 20: The owner received first utility bill in the amount of $135, due in April.

·
March 20: Office copier required maintenance; owner paid $95.00 for copier servicing.

·
March 22: Owner withdrew $500 cash for personal use.

·
March 25: Owner paid $215 for office supplies.

·
March 25: Owner provided service to client in the amount of $350. Client paid at time of service.

·
March 30: Owner paid balance due for advertising expense purchase on March 8.

·
March 30: Received payment from customer for March 10 invoice in the amount of $1,725.

·
March 31: Last day of pay period; owner owes part-time worker $275 for the March 16 through March 31 pay period. This will be paid on April 5.

·
March 31: Provided service for client on account in the amount of $3,500.

·
March 31: Record depreciation of the office furniture at $45.83.

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