Instructions Included: The Unadjusted Trial Balance For S

Instructions Included are The Unadjusted Trial Balance For Sinfully Swe

Instructions Included are the unadjusted trial balance for Sinfully Sweet Desserts at December 31, 2018, and a list of adjusting journal entries required at year-end. First, enter the December 31, 2018, beginning balances from the Unadjusted Trial Balance into your accounting “system” (i.e., enter the beginning balances into the T-accounts provided on pages 4-7). Second, record (write out in proper journal entry format) each of the adjusting entries from page 3 on page 8 (the page with the header “Adjusting Entries”). IMPORTANT – Don’t forget to post each of these adjusting entries to the correct T-accounts on pages 4-7—this ensures that your adjusting entries are correctly updating the various accounts in your “system.” After journalizing and posting all of your adjusting entries, tally up all the ending balances in the T-accounts on pages 4-7. Then, use these ending balances to fill out the Adjusted Trial Balance on page 9. From the Adjusted Trial Balance, complete the Multiple-Step Income Statement (page 10), Statement of Retained Earnings (page 11), and the Classified Balance Sheet (page 12) as of December 31, 2018. (Hint: One of your asset accounts will have a zero balance.) This is an individual project, so each student should submit their own completed packet. However, collaboration is encouraged to enhance understanding and make the activity more engaging.

Paper For Above instruction

The process of adjusting and preparing financial statements is fundamental to accurate financial reporting. This exercise centers on completing the accounting cycle for Sinfully Sweet Desserts as of December 31, 2018, using the unadjusted trial balance and a set of necessary adjusting journal entries. The task emphasizes understanding the importance of proper recording, posting, and adjusting of transactions to reflect the true financial position of a business at fiscal year-end.

The initial step involves transferring the unadjusted trial balance figures into the designated T-accounts. This task lays the groundwork for subsequent adjustments and is crucial because the trial balance provides the foundational data that will be refined through adjustments. The unadjusted balances serve as the starting point, representing the company's accounts before year-end corrections are applied. Proper entry into the T-accounts ensures accuracy and facilitates easier tracking of the adjustments.

Following this, the critical phase involves recording the adjusting entries. Adjusting journal entries are necessary because they update account balances to reflect accrued revenues, accrued expenses, deferrals, and depreciation, thereby ensuring compliance with accrual accounting principles. These journal entries will likely include adjustments for supplies used, depreciation expense, accrued wages, and other necessary corrections indicated on page 3 of the provided materials. Proper formatting of journal entries (debit and credit) maintains the integrity of the financial data.

Once recorded and posted to the T-accounts, the next step is to determine the ending balances after all adjustments are made. These balances form the basis of the adjusted trial balance, which consolidates all account data after adjustments. Completing the adjusted trial balance aids in verifying the equality of debits and credits and setting the stage for financial statement preparation.

With the adjusted trial balance finalized, the next phase involves preparing the core financial statements using the data. The income statement (or profit and loss statement) summarizes revenues and expenses, revealing net income or loss for the year. The statement of retained earnings begins with the opening balance of retained earnings, adds net income, and subtracts dividends to arrive at the ending retained earnings. Lastly, the classified balance sheet presents assets, liabilities, and equity, organized into appropriate categories for clarity and compliance with accounting standards.

Throughout the process, careful attention to detail and correct posting are essential, especially since one asset account may have a zero balance, and accuracy impacts all subsequent financial reporting. Although this is an individual assignment, collaboration can enhance understanding and make the activity more engaging, which aligns with educational best practices.

This exercise encapsulates the entire accounting cycle critical to financial reporting and provides practical experience in journalizing, posting, adjusting, and preparing key financial statements. Mastery of this process equips students with essential skills for professional accounting roles and enhances their comprehension of how financial statements reflect a company's financial health.

References

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