ACCOUNTING CYCLE

a.Find REAL/ACTUAL source documents OR CREATE the source documents used in a business. Each group is required to prepare documents for TWO (2) months.

b.The minimum requirement for the transactions are as follows:

c.

4 cash sales/service per month

5 credit sales/service per month

3 cash purchase of inventories per month

4 credit purchase of inventories per month

3 expenses per month (including 1 accrued expense)

2 current assets purchased within two months (e.g. office supplies & insurance policy)

3 non-current assets purchased within two months (e.g. computer, car, equipment, van, machine, land)

ANY OTHER RELATED DOCUMENTS WHICH YOUR GROUP THINK NECESSARY.

d. Write out the transaction related to each document that you have found/created for the two months. For example: you have a source document purchase invoice dated 1 November 2019 showing the details of credit purchase made. The likely transaction would be: 1 November 2019 - Purchased merchandise on account from XYY Sdn Bhd, list price RM40,000, trade discount 20%, 3/10, n/30.

e. Based on the source documents that you have submitted:

- Record the related transactions in the general journal

- Post to the ledger accounts (column ledger)

- Prepare the trial balance

f. At the end of the second month, prepare:

- The adjusting entries

- The adjusted trial balance

- Examples of adjustments are:

. Depreciation charges

. Supplies used

. Any other related adjustments

g.Prepare the financial statements for the two months ended:

- Income Statement

- Statement of Owners Equity

- Statement of Financial Position

Business Neir's Bakery