Final Project Peyton Approved Data
You will prepare financial statements that will allow you to assess how profitable the business is.
Below you will find the data required to make entries in your accounting workbook. Remember that you are following the business transactions for a six-month period from the initial stage of analysis and recording, through the reporting process. These transactions will include:
· the initial setup of the business
· making payments to vendors
· paying store employees
· managing debt
It will help you to print this document as you are making your entries in your workbook. Your textbook prepares you and can be used as a reference to assist you in completing this assignment. You should begin this project in Module Two.
Complete the following in the “July Journal Entries” in your workbook (be sure to look for the July Journal Entries tab at the bottom of the Peyton Approved Student Workbook).
The following events occur in July 2014:
July 1 – Open a bank account for Peyton Approved.This has been done for you in the July Journal Entries tab.
July 1 – You take $15,000 from your personal savings account and buy common stock in Peyton Approved. This has been done for you in the July Journal Entries tab.
July 3 – Your parents lend the company $10,000 cash, in exchange for a two-year, 6% note payable. Interest and the principal are repayable at maturity.
July 7 – Sign a lease agreement for retail/bakery space. The agreement is for 1 year, with the option to extend the lease on a month-to-month basis after 1 year. The rent is $1,500 per month. The lease period starts on July 15, first and last month’s rent due at that time. Subsequent rents are due on the 15th day of each month.
July 10 – Pay $375 to the county for a business license.
July 11 – Purchase a cash register for $250 (deemed to be not material enough to qualify as depreciable equipment—use misc. exp.).
July 13 – You have baking equipment, including an oven and mixer, that you have been using for your home-based business and will now start using in the bakery. You estimate that the equipment is currently worth $5,000, and you transfer the equipment into the business in exchange for additional common stock. The equipment has a 5-year useful life.
July 13 – Pay $200 for business cards/flyers/posters/ads to use for advertising.
July 14 – Pay $1,000 for baking ingredients (use baking supplies account).
July 14 – Pay $300 for miscellaneous (use misc. supplies).
July 15 – Hire part-time helper to be paid $12 per hour. Pay periods are the 1st through the 15th and 16th through the end of the month with paydays being the 20th for the first pay period and the 5th of the following month for the second pay period.
July 15 – Pay first and last month’s rent.
July 16 – Open the doors of the bakery.
July 31 – Pay $1,200 for a 12-month insurance policy.
Enter the Bakery Sales totals (below) in the appropriate Journal Entries month tab, as indicated below. See sample in the August Journal Entries tab.
The following events occur during the next 6 months:
Bakery sales are recorded on the last day of the month. The following sales occurred:
July – $5,000
August – $20,000 (cell B28)
September – $22,500
October – $27,000
November – $25,000
Enter the baking supply purchases (below) in the appropriate Journal Entries month tab, as indicated below. See sample in the September Journal Entries Tab.
The following baking supplies purchases are made on credit:
August 8 – $8,500, net 30 – paid 8/30
September 10 – $9,000, net 30 – paid 10/1 (cell B10)
October 12 – $10,000, net 30 – paid 11/1
November 10 – $10,000, net 30 – paid 12/1
December 4 – $12,000, net 30 – paid 1/2
Enter the miscellaneous supplies purchased (below) in the appropriate Journal Entries month tab, as indicated below. See sample in the October Journal Entries Tab.
The following misc. supplies were purchased:
August 25 – $300
September 19 – $325
October 14 – $310 (cell B19)
November 11 – $300
December 8 – $300
Enter payroll (below) in the appropriate Journal Entries month tab, as indicated below. See sample in the November Journal Entries Tab.
Through December 31, the part-time employee worked the following hours: (ignore payroll taxes)
(see table )
Month Hours Rate Pay
31-Jul $10.00 $12.00 $120.00
15-Aug $40.00 $12.00 $480.00
31-Aug $35.00 $12.00 $420.00
15-Sep $38.00 $12.00 $456.00
30-Sep $40.00 $12.00 $480.00
15-Oct $37.00 $12.00 $444.00
31-Oct $40.00 $12.00 $480.00
15-Nov $35.00 $12.00 $420.00
30-Nov $30.00 $12.00 $360.00
15-Dec $45.00 $12.00 $540.00
31-Dec $40.00 $12.00 $480.00
Enter the following monthly bills received and paid (below) in the appropriate Journal Entries month tab, as indicated below. See sample in the December Journal Entries tab (sample in cells B22, B28, and B57).
The following monthly bills are received and paid (July–December)
Rent – paid each 15th – $1,500
Phone – received on the 30th of each month, paid on the following 10th – $45
You pay yourself via the issuance of dividends. Enter the dividends (below) in the appropriate Journal Entries month tab, as indicated below. See sample in the September Journal Entries tab.
The following dividends were paid and issued:
9/30 – 2,000 (Cell B32)
10/30 – 2,500
11/30 – 2,500
12/31 – 2,500
Here’s the SOLUTION