ACCOUNTING ASSIGNMENT/FINANCIAL STATEMENTS:

  • Develop and maintain a simple accounting system.
  • Prepare a balance sheet, statement of income, statement of changes in owner's equity, and statement of cash flows.
  • Calculate the following financial tools in business settings/decisions: future and present value of an annuity and a monetary unit, perpetuities, compound interest rates, loan amortization, and internal rate of return.

Problem:
Prepare financial statements for The Far Horizon for the six-month period ending June 30, 2006.

Note: The Far Horizon documents (Far Horizon Case Information 06and Far Horizon Business Plan 06) are included as attachments under the Case Study heading located in the structure to the left.
Task:

Part 1: Develop and maintain a simple accounting system
Refer to "Summary of Financial Transactions Through June 30, 2006" (provided in The Far Horizon data).

  1. Develop and use a simple accounting system to record the business transactions using a Microsoft Excelspreadsheet. The accounting system you submit must include:
  2. General Journal
  3. T-Accounts
  4. Chart of Accounts
  5. Amortization Table
  6. Adjusting Entries for the period January 1, 2006, through June 30, 2006.

Assume the following timeline for the financial statements (also attached below as a .jpeg):

1/1/2006 - Owner purchased The Far Horizon property

(2 months)

3/1/2006 - Restaurant and bar/lounge opened

(4 months)

6/30/2006 - Financial statements

Part 2: Prepare a balance sheet, income statement, statement of cash flows, and statement of changes in owner's equity
Using the results of the accounting system you developed in Part 1 and the financial statement templates (provided in The Far Horizon data), prepare the following financial statements for The Far Horizon:

  1. Balance sheet as of June 30, 2006.
  2. Income statement for the six-month period ending June 30, 2006.
  3. Statement of cash flows for the six-month period ending June 30, 2006.
  4. Statement of changes in owner's equity for the six-month period ending June 30, 2006.

You may submit your work as attachments (Excel spreadsheets or Word documents) or enter it into the TaskStream frames as text.

Note: When using outside sources to support ideas and elements in a paper, the submission MUST include APA formatted in-text citations with a corresponding reference list for any direct quotes or paraphrasing. It is not necessary to list sources that were consulted if they have not been quoted or paraphrased in the text of the paper.

Note: No more than a combined total of 30% of a submission can be directly quoted or closely paraphrased from outside sources, even if cited correctly. Here are some helpful APA resources:



TIMELINE:

01/01/2006 03/01/2006 06/30/2006

OWNER PURCHASED RESTAURANT AND FINANCIAL STATEMENTS

THE FAR HORIZON PROPERTY BAR/LOUNGE OPENED

2 MONTHS 4 MONTHS