Financial Accounting Written Report Assignment
Purpose of the assessment - The purpose of this assignment is to assess the following Learning Outcomes:
a. Interpret and explain accounting concepts and principles
d. Record financial accounting transactions using the accrual method of accounting
e. Prepare general purpose financial statements
Assignment Instructions - This assignment is comprised of three parts.
Part A - Draper Consulting Services
Glen McGrath is the CEO of Draper Consulting Services who is very upbeat about the newly developed accounting software by his company and has approved its launch in January 2017. Draper Consulting Services has traditionally performed systems consulting work. At the end of January 2017 Glen asked his accountant to prepare the financial statements. The financial year for Draper Consulting is the Calendar year January to December. Listed below is the post-closing trial balance as at 31st December 2016.
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DRAPER CONSULTING Services Post-closing trial balance as at 31 December 2016
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Account
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Debit
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Credit
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Cash
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$16 350
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Accounts receivable
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1750
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Software inventory
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Supplies
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200
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Prepaid rent
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Equipment
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2 000
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Accumulated depreciation-equipment
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$200
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Furniture
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5 200
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Accumulated depreciation-furniture
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520
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Accounts payable
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1 780
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Salary payable
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1 370
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Unearned service revenue
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700
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Draper capital
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______
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20 930
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Total
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$25 500
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$25 500
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Following are the transactions for the month of January 2017:
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Date
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Transactions
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Jan2
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Completed a consulting engagement and received cash of $8 800.
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Jan2
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Prepaid three months office rent, $2 650.
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Jan7
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Purchased 160 units software inventory on credit, $2680, plus freight in, $160.
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Jan 18
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Sold 80 software units on credit, $4 500 (cost $980).
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Jan 19
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Consulted with a client for a fee of $2 000 on credit.
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Jan 20
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Paid employee salary, $4 055.
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Jan 21
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Paid on account, $2 760.
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Jan 22
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Purchased 340 units software inventory on credit, $8 840.
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Jan 24
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Paid electricity and gas, $350.
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Jan 28
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Sold 220 units software for cash, $5 680 (cost $3 960).
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Jan 31
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Recorded the following adjusting entries:
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Accrued salary expense, $1 370
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Depreciation, $720 ( Equipment, $200; Furniture, $520)
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Expiration of prepaid rent, $650
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Physical count of inventory, 185 units, $6 350
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Requirements:
Complete ALL six requirements, and include narratives for all journal entries.
Open the following selected T-accounts in the ledger: Cash; Accounts receivable; Software inventory; Prepaid rent; Accumulated depreciation - equipment; Accumulated depreciation- furniture; Accounts payable; Salary payable; Carl Draper, capital; Carl Draper, drawings; Income summary; Service revenue; Sales revenue; Direct expense; Salary expense; Rent expense; Electricity and gas expense; Depreciation expense-equipment; Depreciation expense-furniture.
1. Journalise and post the January transactions. Key all items by date. Calculate each account balance and denote the balance as 'Bal'.
2. Journalise and post the closing entries. Denote each closing amount as 'Clo'. After posting all closing entries, prove the equality of debits and credits in the ledger.
3. Prepare the January income statement of Draper Consulting. Use the descriptive (by nature) format. Include changes in inventory in the Direct expense account.
4. Prepare the statement of changes in equity of Draper Consulting for the month ended 31 January 2017. Make sure you include all relevant details.
5. Prepare the classified balance sheet in report form of Draper Consulting as at 31 January 2017.
Part B - Accrual Accounting and Unethical Behaviour
'Accrual accounting provides opportunities for unethical behaviour' (Nobles et al 2016, page 127) (i.e., the prescribed textbook).
Guidance on ethical behaviour, in particular, on the fundamental principles of professional ethics for accountants, can be found in authoritative documents such as APES 110 Code of Ethics for Professional Accountants
Requirements -
1. Explain what is meant by unethical behaviour for accountants in general and specifically in relation to accrual accounting.
2. Identify two cases as appearing in either the media (i.e., newspapers, e.g., The Financial Review), professional accounting journals (e.g., the CPA's In the Black) or academic accounting/business ethics journals (e.g.,Australian Accounting Review) that show how accrual accounting can be used for unethical behaviour. Your two cases do not need to relate to two separate business entities. Your must reference your sources in your list of references - which will be checked by the marker.
Part C - Quality, Convention and Neatness
Your written report will assessed for quality, convention, and neatness, including following the Submission Guidelines as detailed above, use of English grammar, sentence structure, etc. In sum, submit a report that you will be proud to show others, including a future employer!
Attachment:- Assignment File.rar