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of Edward Snips, has leamed from Edward about the excellent experience he had workin ing Accounting 110 at Camosun College. Edward mentioned that he was very happy with the accounting work performed recently for his Scissors Alive business by these students. As a result io ike to have accounting work performed for her new business Topcut Jewelry". which she started on : 2019. She needs to borrow money from the bank to expand her business so she needs assistance in with students professional Tanya would like have preparing the company's financial statements for the year ended March 31,2019. While Tanya has a bookkeeper who has been doing most of her accounting, she needs assistance with the below three items. Part 1 Tanya would like you to prepare all necessary adjusting entries in Excel in the general journal and post them to the trial balance worksheet, linking the trial balance worksheet Adjusting entries' column to the general journal (using-). She will then have her bookkeeper record them into their general ledger and subledgers later. Tanya provides you with the following information: Accounts Receivable - $2,400 written off. The bookkeeper was not sure of how to do this entry so you will do it as an adjusting entry. In of the accounts receivable balance, from lama Baddebt, needs to be ret addition, after the write off, Tanya estimates that $21,000 of her accounts receiv the future and needs you to prepare the adjusting entry Office Supplies, Prepaid Insurance, and Prepaid Rent- Tanya advises that the business had $11,000 of office supplies left on hand at March 31, 2019, that th t $8,200 of the prepaid insurance has expired, and that e remaining prepaid rent balance should be a $1,500 deposit for the final month of the lease Note Payable-the note had an introductory interest rate of 3% until December 31, 2018, at which time the business paid $13,500 for interest from April 1, 2018 (date of loan) to December 31, 2018. The note now as an interest rate of 5.5% which will be paid on December 31, 2019, Tanya needs you to prepare any 3. sary adjusting entry to March 31, 2019 to accrue interest owing for the three months. revenue - Tanya advises that the unearned revenue is for prepayments received from customers before they pick-up their jewelry. By March 31, 2019, $82,000 of the unearned revenue has been eamed, with customers purchasing jewelry that had a total original cost of $50,000. She needs you record the earning of these sales and the expensing of the sold jewelry, which is still incorrecty on her books as inventory. Inventory purchase and sales-Tanya's bookkeeper was not sure how to record a recent purchase of inventory and a sale of inventory, both which received a discount. It was the first time that the business had used discounts so the bookkeeper was not sure of the entries. Tanya would like you to record these entries as adjusting entries as they have not yet been recorded on her books On March 10, 2019, the business purchased $60,000 of inventory on account, terms 2/10,n/30. The business paid for the inventory on March 19, less the discount .On March 21, 2019, Tanya sold inventory that cost $50,000 to one of her best customers for $75,000 on account, with the terms 5/7, n/30. The customer paid for the purchase in tull on March 23 and received the discount 6. Amortization - Tanya advises you that the store equipment has a 15 year useful life, with a residual value of $12,000. Tanya would like to use the straight-line method. For the office equipment, she expects it will also have a 10 year useful life, with a residual value of $45,000 but she would like to use the double- declining balance method. Both the store and office equipment were 7. Salaries- Tanya April 1, 2018. advises that at March 31, 2019, the company owed an additional $12,000 in salaries that were paid in April. She indicated that you do not need to worry about El, CPP, etc as her bookkeeper will calculate the withholdings. An adjusting entry is needed however to accrue the salaries owed to March 31 2019. Part 2 Tanya would like you to cross add the unadjusted trial balance and the adjusting entries column in Excel o determine the adjusted trial balance. Based on the adjusted trial balance, she would like you to prepare n proper form, a classified balance sheet and a multi-step income statement. It is not necessary to prepare he statement of equity art 3 anya will be showing the above financial statements to her banker, as she hopes to borrow funds to expand the knows that the banker will analyze her statements, including calculate ratios. She leans about the llowing ratios that are average for the jewelry industry Current ratio- 2 to 1 Debt to asset ratio-60% Accounts receivable turnover ratio 10 times Accounts receivable turnover in days 36.5 days Gross Margin (aka Gross Profit) 55% Inventory turnover ratio-5 times he would like you to calculate the above ratios for her business in Excel and explain for nd whether her results are positive or negative compared to the industry. of Edward Snips, has leamed from Edward about the excellent experience he had workin ing Accounting 110 at Camosun College. Edward mentioned that he was very happy with the accounting work performed recently for his Scissors Alive business by these students. As a result io ike to have accounting work performed for her new business Topcut Jewelry". which she started on : 2019. She needs to borrow money from the bank to expand her business so she needs assistance in with students professional Tanya would like have preparing the company's financial statements for the year ended March 31,2019. While Tanya has a bookkeeper who has been doing most of her accounting, she needs assistance with the below three items. Part 1 Tanya would like you to prepare all necessary adjusting entries in Excel in the general journal and post them to the trial balance worksheet, linking the trial balance worksheet Adjusting entries' column to the general journal (using-). She will then have her bookkeeper record them into their general ledger and subledgers later. Tanya provides you with the following information: Accounts Receivable - $2,400 written off. The bookkeeper was not sure of how to do this entry so you will do it as an adjusting entry. In of the accounts receivable balance, from lama Baddebt, needs to be ret addition, after the write off, Tanya estimates that $21,000 of her accounts receiv the future and needs you to prepare the adjusting entry Office Supplies, Prepaid Insurance, and Prepaid Rent- Tanya advises that the business had $11,000 of office supplies left on hand at March 31, 2019, that th t $8,200 of the prepaid insurance has expired, and that e remaining prepaid rent balance should be a $1,500 deposit for the final month of the lease Note Payable-the note had an introductory interest rate of 3% until December 31, 2018, at which time the business paid $13,500 for interest from April 1, 2018 (date of loan) to December 31, 2018. The note now as an interest rate of 5.5% which will be paid on December 31, 2019, Tanya needs you to prepare any 3. sary adjusting entry to March 31, 2019 to accrue interest owing for the three months. revenue - Tanya advises that the unearned revenue is for prepayments received from customers before they pick-up their jewelry. By March 31, 2019, $82,000 of the unearned revenue has been eamed, with customers purchasing jewelry that had a total original cost of $50,000. She needs you record the earning of these sales and the expensing of the sold jewelry, which is still incorrecty on her books as inventory. Inventory purchase and sales-Tanya's bookkeeper was not sure how to record a recent purchase of inventory and a sale of inventory, both which received a discount. It was the first time that the business had used discounts so the bookkeeper was not sure of the entries. Tanya would like you to record these entries as adjusting entries as they have not yet been recorded on her books On March 10, 2019, the business purchased $60,000 of inventory on account, terms 2/10,n/30. The business paid for the inventory on March 19, less the discount .On March 21, 2019, Tanya sold inventory that cost $50,000 to one of her best customers for $75,000 on account, with the terms 5/7, n/30. The customer paid for the purchase in tull on March 23 and received the discount 6. Amortization - Tanya advises you that the store equipment has a 15 year useful life, with a residual value of $12,000. Tanya would like to use the straight-line method. For the office equipment, she expects it will also have a 10 year useful life, with a residual value of $45,000 but she would like to use the double- declining balance method. Both the store and office equipment were 7. Salaries- Tanya April 1, 2018. advises that at March 31, 2019, the company owed an additional $12,000 in salaries that were paid in April. She indicated that you do not need to worry about El, CPP, etc as her bookkeeper will calculate the withholdings. An adjusting entry is needed however to accrue the salaries owed to March 31 2019. Part 2 Tanya would like you to cross add the unadjusted trial balance and the adjusting entries column in Excel o determine the adjusted trial balance. Based on the adjusted trial balance, she would like you to prepare n proper form, a classified balance sheet and a multi-step income statement. It is not necessary to prepare he statement of equity art 3 anya will be showing the above financial statements to her banker, as she hopes to borrow funds to expand the knows that the banker will analyze her statements, including calculate ratios. She leans about the llowing ratios that are average for the jewelry industry Current ratio- 2 to 1 Debt to asset ratio-60% Accounts receivable turnover ratio 10 times Accounts receivable turnover in days 36.5 days Gross Margin (aka Gross Profit) 55% Inventory turnover ratio-5 times he would like you to calculate the above ratios for her business in Excel and explain for nd whether her results are positive or negative compared to the industry

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