Welcome to the Project Sourdough Alaska, Inc., an Accounting Practice Set for ACCT 102

Welcome!

Welcome to the project Sourdough Alaska, Inc., an accounting practice set for ACCT 102: Principles of Financial Accounting II. The UAA Catalog states, in part, that ACCT 102 is "taught from the perspective of the accountant/bookkeeper who is responsible for recording accounting transactions." This practice set is designed to give you practice in recording and posting a relatively complex set of transactions for a hypothetical merchandising company. Its purpose is to provide you with an opportunity to put into practice the basic accounting concepts you learned in ACCT 101, as well as the more advanced concepts you have learned in ACCT 102. In this practice set you will use a set of special journals to record the transactions (Chapter 7) and you will fill out a worksheet (Chapter 4). Many of you are accounting majors and this is what you have chosen for your life's work - so, have fun doing this practice set.

The instructions must be followed explicitly if you are to receive full credit. This assignment is to be completed individually. If you have any questions about this assignment, please contact me, not your fellow classmates, the tutors in the accounting lab, your neighbors, or your mom’s friend’s CPA. I expect all students to honor this requirement.Outside assistance is not allowed. If you seek assistance from anyone other than the instructor you will be referred to the Dean of Students office for academic dishonesty.

An Excel template is provided.Only this template will be accepted for this assignment.To complete this assignment, you may need to modify the template by adding rows or accounts. You are also required to fill in an Excel formula in all cells that are colored orange. Note that you may use additional formulas, even if they are not required (for example, in the CP journal, or in the financial statements spreadsheet). To begin, download the spreadsheet and rename it "LastName_FirstName Initial_Sourdough_Alaska", replacing “LastName” with your last name and “First Name Initial” with the initial of your first name.

This practice set is due in electronic format via Blackboard on or before November 21, at 5:30 p.m. Any late assignments (including assignments submitted at 5:35 p.m.) will be charged a 10% per day “late fee” (including weekend days).

I have assumed that all students have some familiarity with a spreadsheet program, but I am willing to provide some fundamental instruction on how to use the Excel templates if necessary. If you would like a short workshop on Excel formulas and formatting, please email me. If enough students are interested, I'll hold a Blackboard Collaborate workshop on Excel. Otherwise, we can “meet” one-on-one to discuss Excel.

Please take the time to review all the documentation before proceeding. If you identify any typographical errors, inconsistencies, or problems with the data or template, please email your observations to me and you may find yourself earning some extra points for this assignment. (Only the first student to email me with a legitimate observation will be awarded any points.) Happy hunting!

Introduction

Sourdough Alaska, Inc. (Sourdough), is a retailer of sturdy outdoor wear specifically designed for use in cold climates. The business was first located in a small strip mall located in South Anchorage and was owned and operated by Jonathan Seward, a life-long Alaskan. Because of his love for the outdoors, his infectious enthusiasm, and a strong desire to please his customers, he soon outgrew his South Anchorage location and began looking for the ideal location. He finally found the "perfect" location in Mid-town Anchorage and in September 1935 "Sourdough Alaska, Inc." opened its doors for business.

Since that early beginning, Sourdough has become the premier outdoor clothing store in the Anchorage Bowl. The business has been built on one over-riding theme, which is "the customer is king." Jonathan Seward retired two years ago and the business is now being run by his son John P. Seward, who shares his father's love of the outdoors.

You have been employed by Sourdough to be their General Ledger Bookkeeper. As such, you will maintain the general ledger and prepare year-end financial reports. The accounting records are current through June 19, 2013 and all account balances are correctly stated. You will, therefore, be able to concentrate only on the transactions beginning June 20, 2013. A few additional pieces of information will prove useful in your job.

·  Sourdough uses a fiscal year ending June 30 for financial reporting purposes.

·  The perpetual inventory system is used.

·  To reduce the number of journal entries, cash sales are posted weekly.

·  Adjusting entries are made monthly, closing entries are made at the end of the fiscal year, and reversing entries are not used.

·  All prepaid and unearned items are recorded initially in asset and liability accounts respectively.

·  Depreciation is calculated on a straight-line basis.

·  Assets purchased between the 1st and 15th of the month are depreciated for a full month. Assets purchased after the 15th are not depreciated until the following month.

·  The Trial Balance and Schedules of Accounts Receivable and Accounts Payable as of May 31, 2013 are provided.

Sufficient information and all necessary templates have been provided for the completion of this practice set. Should you have any questions, please contact me via email or by phone at 907-786-4137.

Instructions and Submissions

To receive full credit for this project, you must complete all of the following steps. You must use the proper format for journal entries, ledgers and financial statements, and you must use the templates provided. This is an individual assignment and all work must be done by you personally, with assistance from the instructor only.

1.  All beginning balances are correctly reflected in the General Ledger accounts.

2.  Record the June 2013 transactions in the appropriate journals beginning with the June 20, 2013 transaction. All transactions from June 1 through June 19, 2013 have already been journalized (but not posted). Refer to the Chart of Accounts for appropriate account titles.

3.  Post individual transactions, or totals, as appropriate to the accounts in the general ledger. Post to subsidiary ledgers as necessary. Refer to Chapter 7 for a review of the posting process if necessary.

4.  Determine the balance in each account in the general ledger.

5.  Complete the work sheet (refer to Chapter 4 for a review if necessary).

6.  Prepare the following financial statements and schedules:

a.  Multi-Step Income Statement

b.  Statement of Retained Earnings

c.  Classified Balance Sheet

d.  Schedule of Accounts Receivable

e.  Schedule of Accounts Payable

7.  Journalize and post the adjusting entries.

8.  Journalize and post the closing entries.

9.  Prepare a post-closing trial balance.

10.  Review your work and submit your assignment by 5:30 p.m. on November 21st to avoid the late fee. Submit the following (all items below should be included in the Excel template file):

a.  A “signed” code of conduct statement (you can simply type your name in)

b.  Sales Journal

c.  Purchases Journal

d.  Cash Receipts Journal

e.  Cash Payments Journal

f.  General Journal

g.  Work Sheet

h.  Financial Statements

i.  AR and AP Schedules

j.  Post-Closing Trial Balance

Some Useful Hints

Checklist

·  Are your journal entries formatted properly (including descriptions)? If, for some reason, you are unsure, you should review chapter 2 in the text.

·  Are your dollar amounts formatted correctly? Generally, financial statements have a dollar sign for the first amount in each column, not for every dollar amount in the statement. See Chapter 4 for a Classified Balance Sheet and Chapter 5 for a Multi-Step Income Statement.

·  For the general journal, have you left a blank line between journal entries and have you provided a brief explanation of transactions? Did you label your adjusting entries with a header? Did you label your closing entries with a header?

·  Are your posting references complete? (See Chapter 2)

·  Is your income statement a multiple-step statement? (See Chapter 5)

·  Is your balance sheet classified? (See Chapter 4)

·  Does everything balance?

Chart of Accounts

447 Gain/Loss on Exchange

448 Depreciation Expense: Delivery Equipment

June Transactions