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Accounting Cycle Project - Solid Footing 5e

Project is Activated

First Name: Last Name: ID Code:

Before you begin working on your project,


save your activated project by following the directions in the Saving Your Project box.

Instructions:
You will be recording the July 2011 transactions for Lenny's Lawn Service, Inc. After recording the July transactions you will be preparing a Pre-Closing Trial Balance, Income Statement, Statement of Stockholders' Equity, Balance Sheet, and Post-Closing Trial Balance.

Save your project in a file that uses your name a form: LastName file name SmithMary

Windows Excel 2010 and Excel 2003


- Click File - Click Save As - In File name - Click Save

As you work on your project, be sure to save your Excel file often.
You are given the following:

Windows Excel 2007

_ _ _ _ _

July 2011 transactions and Additional Information -- Trans tab Chart of Accounts with Account Numbers and Account Names -- Chart Accts tab General Journal pages -- Journal tab Lenny's General Ledger -- GL Assets, GL Liab-Equity, GL Rev-Exp-Div tabs Forms for the July 31, 2011 Pre-Closing Trial Balance, Income Statement, Statement of Stockholders' Equity, Balance Sheet, and Post-Closing Trial Balance Trial Bal, IS & SEquity, BalSht, and Post Close TB tabs

- Click the - Point to Save As - Click Excel 97 - In File name - Click Save Any time you save your project, if Excel 2007 as this document by converting to an Office Open X

Mac Excel 2011


- Click File - Click Save As - In Save As: - Format should be - Click Save - Always Click
Steps 1 and 2 in the Accounting Cycle Step 1 For each business transaction that occurs during the accounting period, determine the effect of the transaction on the General Ledger accounts. Step 2 Make an entry in the General Journal for each transaction and post the entry to the General Ledger accounts.

To Complete Your Project do the following:

_ Print the July Transactions (click the Trans tab and then click the Printer Icon) _ Print the Chart of Accounts (click the Chart Accts tab and then click the Printer Icon) _ Record the July transactions in the General Journal. Click the Journal tab and record
your entries directly into the General Journal. Look at the July 1 Notes Payable transaction, which has already been entered, for an example of how to make your entries. Do not put the "X" in the Posted column at this time. Use the printed Chart of Accounts as a reference source for the Account Numbers and Account Names that are available in Lenny's accounting system.

_ _

To make posting from the General Journal to the General Ledger easier, it is recommended that you print the General Journal -- click the Journal tab and then click the Printer Icon. Post the entries from the printed General Journal to the General Ledger accounts. Click the GL Assets, GL Liab-Equity, and GL Rev-Exp-Div tabs to find the accounts to be posted. Record your postings directly into the General Ledger. As you post an amount to an account be sure to enter the General Journal Page # into the Journal Page # column. See the first posting to the Cash account for an example. After you post an amount to a General Ledger account, then hand write an "X" in the Posted column of the printed General Journal. This will help you keep track of which entries you have posted.

_ Enter the "X"s, which you hand wrote on your General Journal pages, into the
General Journal. Click the Journal tab and enter the "X"s in the Posted column

Pg. 2

Determine the required adjusting entries as of July 31, 2011. Click on the Trans tab and look at the Additional Information given at the bottom of the screen for information needed to prepare the adjusting entries. Click the Journal tab and record your adjusting entries in the General Journal. Use the printed Chart of Accounts as a reference source for the Account Numbers and Account Names that are available in Lenny's accounting system. Put your adjusting entries on Page # 4 of the General Journal. Post the adjusting entries from the General Journal to the General Ledger accounts. Click the GL Assets, GL Liab-Equity, and GL Rev-Exp-Div tabs to find the accounts to be posted. As you post an amount to an account be sure to enter the General Journal Page # into the Journal Page # column. After you post an amount to a General Ledger account, click back on the Journal tab and enter an "X" in the Posted column of the General Journal. Print Lenny's General Ledger by: clicking the GL Assets tab and then clicking the Printer icon, clicking the GL Liab-Equity tab and then clicking the Printer icon, and clicking the GL Rev-Exp-Div tab and then clicking the Printer icon. Using the printed General Ledger, enter the ending account balances into the July 31, 2011 Pre-Closing Trial Balance. Click the Trial Bal tab and enter the amounts into the Pre-Closing Trial Balance. Print the July 31, 2011 Pre-Closing Trial Balance by clicking the Printer icon.

Step 3 in the Accounting Cycle At the end of the accounting period, before preparing the financial statements, determine if any of the General Ledger account balances need to be adjusted. Enter any required adjusting entries into the General Journal and post the adjusting entries to the General Ledger accounts.

Step 4 in the Accounting Cycle Prepare a Pre-Closing Trial

Balance to determine that the accounts in the General Ledger are in balance.

Step 5 in the Accounting Cycle

Using the printed July 31, 2011 Pre-Closing Trial Balance, prepare the July 2011 Income Statement. Click the IS & SEquity tab and enter the amounts into the Income Statement.

Prepare an Income Statement from the ending balances in the General Ledger revenue and expense accounts.
Step 6 in the Accounting Cycle

Using the printed July 31, 2011 Pre-Closing Trial Balance, prepare the July 2011 Statement of Stockholders' Equity. Click the IS & SEquity tab and enter the amounts into the Statement of Stockholders' Equity.

Calculate the ending balance of the Retained Earnings account that is needed for the preparation of the Balance Sheet
Step 7 in the Accounting Cycle

Using the printed July 31, 2011 Pre-Closing Trial Balance and the Retained Earnings amount from the Statement of Stockholders' Equity, prepare the July 31, 2011 Balance Sheet. Click the BalSht tab and enter the amounts into the Balance Sheet.

Prepare the Balance Sheet from the ending balances in the General Ledger asset accounts, liability accounts, Common Stock account, and the calculated ending balance for the Retained Earnings account.
Step 8 in the Accounting Cycle

_ _

Prepare the closing entries. Click the Journal tab and enter the closing entries into the General Journal. Place your closing entries on Page # 5 of the General Journal. Post the closing entries from the General Journal to the General Ledger accounts. Click the GL Liab-Equity, and GL Rev-Exp-Div tabs to find the accounts to be posted. As you post an amount to an account be sure to enter the General Journal Page # into the Journal Page # column. After you post an amount to a General Ledger account, click back on the Journal tab and enter an "X" in the Posted column of the General Journal.

Prepare and enter the revenue, expense, and dividend closing entries into the General Journal, and post the closing entries to the General Ledger accounts.

Step 9 in the Accounting Cycle

Click the Post Close TB tab and prepare the July 31, 2011 Post-Closing Trial Balance.

Prepare a Post-Closing Trial Balance to determine that the accounts in the General Ledger are in balance and ready to start a new Accounting Cycle.

Your project is complete! Your instructor will provide you with directions on how to submit your project.

Lenny's Lawn Service, Inc. - Transactions - Additional Information July 2011 Transactions
Date Description of the Transaction Borrow $35,000.00 from 1st Bank by signing a 24 month note with a 4% annual interest rate.
(As an example of how to journalize and post a transaction -- this transaction has already been entered into the General Journal and posted to the General Ledger.)

July 1

July 1 July 1 July 1 July 3 July 5

Receive $58,000.00 cash from new investors, and issue $58,000.00 of Common Stock to them. Purchase $84,000.00 of new mowing equipment, paying cash to the mower dealer. Pay $500.00 cash for the July truck rental. Invoice a new customer $900.00 for a completed mowing job -- customer will pay in 10 days. The Board of Directors declares a cash dividend. The total amount of the dividend is $11,000.00 The Date of Record is set as July 15. The Date of Payment is set as July 31. Pay the employees $6,000.00 for work performed during the 1st week of July.

July 7

July 10 Complete a mowing job for a new customer -- customer pays $500.00 cash for the job. July 12 Collect $3,500.00 cash from the golf course for special rush mowing job completed on May 31, 2011. July 14 Pay the employees $4,800.00 for work performed during the 2nd week of July. July 15 Purchase $50.00 of supplies from the mower dealer. The supplies are consumed immediately. Lenny's will pay the mower dealer for the supplies in about 2 weeks. July 15 Collect $900.00 on account. The cash that is received is from the new customer for the job that was completed on July 3. July 17 One of the original mowers purchased in January of 2010 broke down and is repaired by the mower dealer. The cost of the Mower Repair job is $430.00. Lenny's will pay the mower dealer in 30 days. July 19 Purchase for cash $17,000.00 of supplies. These supplies will be consumed over the next 12 months. July 20 Collect $30,000.00 from the property management company for work performed in June. July 21 Pay the employees $5,750.00 for work performed during the 3rd week of July. July 23 Receive a $48,000.00 advance payment from the university. The advance payment is for 6 months of work which will be performed from August 1, 2011 to January 31, 2012. July 25 Complete a special mowing job for the golf course. The total price for the mowing job is $3,900.00. The golf course pays $1,000.00 cash on this date and will pay the remainder on August 25. July 27 Complete a mowing job for a new customer -- customer pays $225.00 cash for the job. July 27 Pay $50.00 cash to the mower dealer for the supplies purchased on account on July 15. July 28 Pay the employees $6,300.00 for work performed during the 4th week of July. July 31 Invoice the property management company $33,000.00 for July mowing work. The property management company will pay the invoice on the 20th of next month. July 31 Pay the cash dividend which was declared on July 5.

Additional Information
Equipment: The $48,000.00 beginning balance in the Equipment account relates to the mowing equipment which was purchased on January 2, 2010. For information related to this mowing equipment see Page 70 in the Solid Footing book. This equipment continues to be used and should be depreciated for the month of July. The following information relates to the new equipment which was purchased on July 1, 2011: The new equipment was placed into service on July 1, 2011 and should be depreciated for the month of July. The estimated useful life of the new equipment is 5 years. At the end of 5 years, the new equipment will have no future value and will be scrapped. The new equipment will be depreciated using the straight-line method. Supplies: At the end of July there are $15,550.00 supplies on-hand.

Mowing Service at the University: The monthly mowing service was provided to the university per the contract signed on April 1, 2011. For information on the contract with the university and the related advance payment, see Pages 95 and 98 in the Solid Footing book. Wages Due the Employees:

The last wage payment was made to the employees on July 28, 2011. The employees worked on July 29, 30, and 31. For these three days of work the employees earned $3,200.00 of wages. These three days of wages will be paid to the workers during the first week of August. The interest on the loan from 1st Bank will be paid every three months. The first interest payment to the bank will be made on September 30, 2011. Lenny's calls the bank on July 31 and the bank indicates that the interest on the loan for July is $115.00

Bank Loan:

Lenny's Lawn Service, Inc. - Chart of Accounts Account # 100 105 110 150 155 200 205 210 215 220 250 300 305 400 500 505 510 515 520 550 600 Account Name Assets: Cash Accounts Receivable Supplies Equipment Accumulated Depreciation Liabilities: Accounts Payable Wages Payable Interest Payable Unearned Revenue Dividends Payable Note Payable Equity: Common Stock Retained Earnings Revenues: Service Revenue Expenses: Supplies Expense Mower Repair Expense Wages Expense Truck Rental Expense Depreciation Expense Interest Expense Dividends: Dividends

Nicole Petriw

Lenny's Lawn Service, Inc. - General Journal


Page # 1 2011
Month-Day Account Number

Account Name Cash Notes Payable Borrowed on Note Payable

Posted

Debit

Credit

7-1

100 250

X X

35,000.00 35,000.00

7-1

100 300

Cash Common Stock Issued Common Stock

X X

58,000.00 58,000.00

7-1

150 100

Equipment Cash Purchase Equipment for Cash

X X

84,000.00 84,000.00

7-1

515 100

Truck Rental Expense Cash Pay Cash for July Truck Rental

X X

500.00 500.00

7-3

105 400

Accounts Receivable Service Revenue Invoice Customer for Complete Mowing Job

X X

900.00 900.00

7-5

600 220

Dividends Dividends Payable Board of Directors Declare Cash Dividend

X X

11,000.00 11,000.00

7-7

510 100

Wages Expense Cash Pay Wages for First Week of July

X X

6,000.00 6,000.00

7-10

100 400

Cash Service Revenue Customer Pays Cash for Job

X X

500.00 500.00

7-12

100 105

Cash Accounts Receivable Collect Cash for Job Completed in May

X X

3,500.00 3,500.00

Lenny's Lawn Service, Inc. - General Journal


Page # 2 2011
Month-Day Account Number

Account Name Wages Expense Cash Pay Wages for Second Week of July

Posted

Debit

Credit

7-14

510 100

X X

4,800.00 4,800.00

7-15

500 200

Supplies Expense Accounts Payable Purchase Supplies on Account

X X

50.00 50.00

7-15

100 105

Cash Accounts Receivable Collect Cash for Job completed on July 3rd

X X

900.00 900.00

7-17

505 200

Mower Repair Expense Accounts Payable Repair Mower on Account

X X

430.00 430.00

7-19

110 100

Supplies Cash Purchase Supplies for Cash

X X

17,000.00 17,000.00

7-20

100 105

Cash Accounts Receivable Collect Cash for Work in June

X X

30,000.00 30,000.00

7-21

510 100

Wages Expense Cash Pay Wages for Third Week of July

X X

5,750.00 5,750.00

7-23

100 215

Cash Unearned Revenue Received Cash for Advance Payment

X X

48,000.00 48,000.00

7-25

100 105 400

Cash Accounts Receivable Service Revenue Collect Cash and on Account for Job

X X X

1,000.00 2,900.00 3,900.00

Lenny's Lawn Service, Inc. - General Journal


Page # 3 2011
Month-Day Account Number

Account Name Cash Service Revenue Receive Cash for Job

Posted

Debit

Credit

7-27

100 400

X X

225.00 225.00

7-27

200 100

Accounts Payable Cash Cash for Supplies Purchased on Account

X X

50.00 50.00

7-28

510 100

Wages Expense Cash Pay Wages for Fourth Week of July

X X

6,300.00 6,300.00

7-31

105 400

Accounts Receivable Service Revenue Invoice for Work Done in July

X X

33,000.00 33,000.00

7-31

220 100

Dividends Payable Cash Pay Cash for Dividend

X X

11,000.00 11,000.00

7-31

520 155

Depreciation Expense Accumulated Depreciation Equipment Depreciation for July

X X

2,400.00 2,400.00

7-31

500 110

Supplies Expense Supplies Supplies Used in July

X X

5,825.00 5,825.00

7-31

215 400

Unearned Revenue Service Revenue Monthly Payment for Contract from April

X X

8,000.00 8,000.00

7-31

510 205

Wages Expense Wages Payable Wages for Last Three Days of July

X X

3,200.00 3,200.00

Lenny's Lawn Service, Inc. - General Journal


Page # 4 2011
Month-Day Account Number

Account Name Interest Expense Interest Payable Interest for Loan

Posted

Debit

Credit

7-31

550 210

X X

115.00 115.00

7-31

400 305

Service Revenue Retained Earnings Close Service Revenue Account

X X

46,525.00 46,525.00

7-31

305 500 505 510 515 520 550

Retained Earnings Supplies Expense Mower Repair Expense Wages Expense Truck Rental Expense Depreciation Expense Interest Expense Close Expense Accounts

X X X X X X X

35,370.00 5,875.00 430.00 26,050.00 500.00 2,400.00 115.00

7-31

305 600

Retained Earnings Dividends Close Dividends Account

X X

11,000.00 11,000.00

Lenny's Lawn Service, Inc. - General Journal


Page # 5 2011
Month-Day Account Number

Account Name

Posted

Debit

Credit

Nicole Petriw

Lenny's Lawn Service, Inc. - General Ledger


Account # 100 2011
Month-Day

Cash
Journal Page #

Debit

Credit

Balance

7-1 7-1 7-1 7-1 7-1 7-7 7-10 7-12 7-14 7-15 7-19 7-20 7-21 7-23 7-25 7-27 7-27 7-28 7-31

Beginning Balance 1 1 1 1 1 1 1 2 2 2 2 2 2 2 3 3 3 3

38,250.00 35,000.00 58,000.00 84,000.00 500.00 6,000.00 500.00 3,500.00 4,800.00 900.00 17,000.00 30,000.00 5,750.00 48,000.00 1,000.00 225.00 50.00 6,300.00 11,000.00

38,250.00 73,250.00 131,250.00 47,250.00 46,750.00 40,750.00 41,250.00 44,750.00 39,950.00 40,850.00 23,850.00 53,850.00 48,100.00 96,100.00 97,100.00 97,325.00 97,275.00 90,975.00 79,975.00

Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr Dr

Account # 105 2011


Month-Day

Accounts Receivable
Journal Page #

Debit

Credit

Balance

7-1 7-3 7-12 7-15 7-20 7-25 7-31

Beginning Balance 1 1 2 2 2 3

33,500.00 900.00 3,500.00 900.00 30,000.00 2,900.00 33,000.00

33,500.00 34,400.00 30,900.00 30,000.00 0.00 2,900.00 35,900.00

Dr Dr Dr Dr Dr Dr Dr

Nicole Petriw

Lenny's Lawn Service, Inc. - General Ledger


Account # 110 2011
Month-Day

Supplies
Journal Page #

Debit

Credit

Balance

7-1 7-19 7-31

Beginning Balance 2 3

4,375.00 17,000.00 5,825.00

4,375.00 Dr 21,375.00 Dr 15,550.00 Dr

Account # 150 2011


Month-Day

Equipment
Journal Page #

Debit

Credit

Balance

7-1 7-1

Beginning Balance 1

48,000.00 84,000.00

48,000.00 Dr 132,000.00 Dr

Account # 155 2011


Month-Day

Accumulated Depreciation
Journal Page #

Debit

Credit

Balance

7-1 7-31

Beginning Balance 3

18,000.00 2,400.00

18,000.00 Cr 20,400.00 Cr

Nicole Petriw

Lenny's Lawn Service, Inc. - General Ledger


Account # 200 2011
Month-Day

Accounts Payable
Journal Page #

Debit

Credit

Balance

7-1 7-15 7-17 7-27

Beginning Balance 2 2 3

0.00 50.00 430.00 50.00

0.00 50.00 480.00 430.00

Cr Cr Cr Cr

Account # 205 2011


Month-Day

Wages Payable
Journal Page #

Debit

Credit

Balance

7-1 7-31

Beginning Balance 3

0.00 3,200.00

0.00 Cr 3,200.00 Cr

Account # 210 2011


Month-Day

Interest Payable
Journal Page #

Debit

Credit

Balance

7-1 7-31

Beginning Balance 4

0.00 115.00

0.00 Cr 115.00 Cr

Account # 215 2011


Month-Day

Unearned Revenue
Journal Page #

Debit

Credit

Balance

7-1 7-23 7-31

Beginning Balance 2 3

8,000.00 48,000.00 8,000.00

8,000.00 Cr 56,000.00 Cr 48,000.00 Cr

Nicole Petriw

Lenny's Lawn Service, Inc. - General Ledger


Account # 220 2011
Month-Day

Dividends Payable
Journal Page #

Debit

Credit

Balance

7-1 7-5 7-31

Beginning Balance 1 3

0.00 11,000.00 11,000.00

0.00 Cr 11,000.00 Cr 0.00 Cr

Account # 250 2011


Month-Day

Note Payable
Journal Page #

Debit

Credit

Balance

7-1 7-1

Beginning Balance 1

0.00 35,000.00

0.00 Cr 35,000.00 Cr

Account # 300 2011


Month-Day

Common Stock
Journal Page #

Debit

Credit

Balance

7-1 7-1

Beginning Balance 1

50,000.00 58,000.00

50,000.00 Cr 108,000.00 Cr

Account # 305 2011


Month-Day

Retained Earnings
Journal Page #

Debit

Credit

Balance

7-1 7-31 7-31 7-31

Beginning Balance 4 4 4

48,125.00 46,525.00 35,370.00 11,000.00

48,125.00 94,650.00 59,280.00 48,280.00

Cr Cr Cr Cr

Nicole Petriw

Lenny's Lawn Service, Inc. - General Ledger


Account # 400 2011
Month-Day

Service Revenue
Journal Page #

Debit

Credit

Balance

7-1 7-3 7-10 7-25 7-27 7-31 7-31 7-31

Beginning Balance 1 1 2 3 3 3 4

0.00 900.00 500.00 3,900.00 225.00 33,000.00 8,000.00 46,525.00

0.00 900.00 1,400.00 5,300.00 5,525.00 38,525.00 46,525.00 0.00

Cr Cr Cr Cr Cr Cr Cr Cr

Account # 500 2011


Month-Day

Supplies Expense
Journal Page #

Debit

Credit

Balance

7-1 7-15 7-31 7-31

Beginning Balance 2 3 4

0.00 50.00 5,825.00 5,875.00

0.00 50.00 5,875.00 0.00

Dr Dr Dr Dr

Account # 505 2011


Month-Day

Mower Repair Expense


Journal Page #

Debit

Credit

Balance

7-1 7-17 7-31

Beginning Balance 2 4

0.00 430.00 430.00

0.00 Dr 430.00 Dr 0.00 Dr

Nicole Petriw

Lenny's Lawn Service, Inc. - General Ledger


Account # 510 2011
Month-Day

Wages Expense
Journal Page #

Debit

Credit

Balance

7-1 7-7 7-14 7-21 7-28 7-31 7-31

Beginning Balance 1 2 2 3 3 4

0.00 6,000.00 4,800.00 5,750.00 6,300.00 3,200.00 26,050.00

0.00 6,000.00 10,800.00 16,550.00 22,850.00 26,050.00 0.00

Dr Dr Dr Dr Dr Dr Dr

Account # 515 2011


Month-Day

Truck Rental Expense


Journal Page #

Debit

Credit

Balance

7-1 7-1 7-31

Beginning Balance 1 4

0.00 500.00 500.00

0.00 Dr 500.00 Dr 0.00 Dr

Account # 520 2011


Month-Day

Depreciation Expense
Journal Page #

Debit

Credit

Balance

7-1 7-31 7-31

Beginning Balance 3 4

0.00 2,400.00 2,400.00

0.00 Dr 2,400.00 Dr 0.00 Dr

Account # 550 2011


Month-Day

Interest Expense
Journal Page #

Debit

Credit

Balance

7-1 7-31 7-31

Beginning Balance 4 4

0.00 115.00 115.00

0.00 Dr 115.00 Dr 0.00 Dr

Nicole Petriw

Lenny's Lawn Service, Inc. - General Ledger

Account # 600 2011


Month-Day

Dividends
Journal Page #

Debit

Credit

Balance

7-1 7-5 7-31

Beginning Balance 1 4

0.00 11,000.00 11,000.00

0.00 Dr 11,000.00 Dr 0.00 Dr

24a15

Nicole Petriw

86325257

Lenny's - July 31, 2011 Pre -Closing Trial Balance


CAUTION Enter amounts into the Pre by typing in the amounts.

Account # 100 105 110 150 155 200 205 210 215 220 250 300 305 400 500 505 510 515 520 550 600 Cash

Account Name

Debit

Credit

Accounts Receivable Supplies Equipment Accumulated Depreciation Accounts Payable Wages Payable Interest Payable Unearned Revenue Dividends Payable Note Payable Common Stock Retained Earnings Service Revenue Supplies Expense Mower Repair Expense Wages Expense Truck Rental Expense Depreciation Expense Interest Expense Dividends

79,975.00 35,900.00 15,550.00 132,000.00 20,400.00 430.00 3,200.00 115.00 48,000.00 0.00 35,000.00 108,000.00 48,125.00 46,525.00 5,875.00 430.00 26,050.00 500.00 2,400.00 115.00 11,000.00 309,795.00

Do NOT copy cells from the Gene

Totals

309,795.00

Nicole Petriw

86325257

Lenny's Lawn Service, Inc. Income Statement


for the Month Ended July 31, 2011 Service Revenue Operating Expenses: Supplies Mower Repair Wages Truck Rental Depreciation Total Operating Expenses Income from Operations Interest Expense Net Income $46,525.00 (5,875.00) (430.00) (26,050.00) (500.00) (2,400.00) (35,255.00) 11,270.00 (115.00) $11,155.00

CAUTION Enter amounts into the Financial Statements by typing in the amounts. Do NOT copy cells from the General Ledger or Pre-Closing Trial Balance.

Note the new line item on Lenny's Income Statement Income from Operations. This is Lenny's income from the normal operations of the lawn mowing business. Interest Expense, which is not a cost of operating the business but rather a cost of financing the business, is shown below Income from Operations. Interest Expense is subtracted from Income from Operations to arrive at Net Income.

Lenny's Lawn Service, Inc. Statement of Stockholders' Equity


for the Month Ended July 31, 2011 Common Stock $50,000.00 58,000.00 Retained Earnings $48,125.00 11,155.00 (11,000.00) $108,000.00

Beginning Balance July 1, 2011 Issue Common Stock Net Income Dividends Ending Balance July 31, 2011

Total $98,125.00 58,000.00 11,155.00 (11,000.00)

$48,280.00 $156,280.00

This is the first time you have prepared a formal Statement of Stockholders' Equity for Lenny's. This statement simply shows what caused the changes in the Stockholders' Equity amounts from last month to this month. Note that the Retained Earnings column on the statement looks the same as the calculation you have been doing each month to determine the Retained Earnings balance needed for the Balance Sheet. Thus, if you prepare a formal Statement of Stockholders' Equity, you have already calculated the Retained Earnings balance needed for the Balance Sheet, and you have completed Step 6 in the Accounting Cycle.

Nicole Petriw

86325257

Lenny's Lawn Service, Inc. Balance Sheet


as of July 31, 2011 Assets Current Assets: Cash Accounts Receivable Supplies Total Current Assets Property & Equipment: Equipment Accumulated Depreciation Property & Equipment, net Total Assets Liabilities & Stockholders' Equity Current Liabilities: Accounts Payable Wages Payable Interest Payable Unearned Revenue Total Current Liabilities Long-Term Liabilities: Note Payable Total Liabilities Stockholders' Equity: Common Stock Retained Earnings Total Stockholders' Equity Total Liabilities & Stockholders' Equity $430.00 3,200.00 115.00 48,000.00 51,745.00 35,000.00 86,745.00 108,000.00 48,280.00 156,280.00 $243,025.00 $79,975.00 35,900.00 15,550.00 131,425.00 $132,000.00 (20,400.00) 111,600.00 $243,025.00

CAUTION Enter amounts into the Balance Sheet by typing in the amounts. Do NOT copy cells from the General Ledger or Pre-Closing Trial Balance.

Note the following three new sub-totals appearing on Lenny's Balance Sheet:

Total Current Assets is a total of those assets, which will turn-into cash during the next 12 months or be consumed during the next 12 months. The comparison of Total Current Assets to Total Current Liabilities gives some indication of Lenny's liquidity -that is, its ability to pay its bills in the short-term.
Property & Equipment, net is the amount of Fixed Asset cost, which remains to be depreciated in future accounting periods. Total Current Liabilities is a total of those liabilities that will require payment in the next 12 months. In the case of Unearned Revenue, this current liability will be "paid-off" by Lenny's delivering mowing services to the university.

Nicole Petriw

86325257

Lenny's - July 31, 2011 Post -Closing Trial Balance


CAUTION Enter amounts into the Post by typing in the amounts.

Account # 100 105 110 150 155 200 205 210 215 220 250 300 305 400 500 505 510 515 520 550 600 Cash

Account Name

Debit

Credit

Accounts Receivable Supplies Equipment Accumulated Depreciation Accounts Payable Wages Payable Interest Payable Unearned Revenue Dividends Payable Note Payable Common Stock Retained Earnings Service Revenue Supplies Expense Mower Repair Expense Wages Expense Truck Rental Expense Depreciation Expense Interest Expense Dividends

79,975.00 35,900.00 15,550.00 132,000.00 20,400.00 430.00 3,200.00 115.00 48,000.00 0.00 35,000.00 108,000.00 48,280.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 263,425.00

Do NOT copy cells from the Gene

Totals

263,425.00

Student's Name: Project Id Code: Class Time: Instructor: Grading Item Pre-Closing Trial Balance Cash Accounts Receivable Supplies Equipment Accumulated Depreciation Accounts Payable Wages Payable Interest Payable Unearned Revenue Dividends Payable Note Payable Common Stock Retained Earnings Service Revenue Supplies Expense Mower Repair Expense Wages Expense Truck Rental Expense Depreciation Expense Interest Expense Dividends

Nicole Petriw 1203811266 86325257 0 Prof. Dallmus Student's Answer

Lenny's Lawn Service, Inc.

Grading Item Balance Sheet Total Assets Retained Earnings Income Statement Net Income Stockholders' Equity Common Stock 7-31 Bal. Retained Earnings 7-31 Bal. Post-Closing Trial Balance Total Debit Column

Student's Answer

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