Accounting Cycle Summarized

• Prepare reversing entries (optional) and post to the ledger(s).

1. Enter the transactions of the period in appropriate journals.
2. Post from the journals to the ledger (or ledgers).
3. Make an unadjusted trial balance (trial balance).
4. Prepare adjusting journal entries and post to the ledger(s).
5. Make a trial balance after adjusting (adjusted trial balance).
6. Prepare the financial statements from the second (adjusted) trial balance.
7. Prepare closing journal entries and post to the ledger(s).
8. Make a post-closing trial balance (optional).

Required: Complete A-F (estimated time to complete is 90 minutes)

1. Prepare journal entries for each of the following 7 transactions.

JE 1 PizzaPan Inc. sold 1 million shares of their common stock for $1/share (par value of the common stock is $.10)

JE 2 PizzaPan Inc. purchased $200,000 inventory from a culinary distributor. PizzaPan inc. had to pay at the point of purchase the full $200,000 (cash).

JE 3 PizzaPan Inc. purchased a delivery truck for $40,000 (cash).

JE 4 PizzaPan Inc. sold on account 10,000 pizza pans to Dominos Corporation. They sold the pans for $5/each. The cost of each pan is $3 ($3/each).

JE 5 PizzaPan Inc. sold on account 5,000 pizza cutters to PizzaHut Corporation. They sold the pizza cutters for $8/each. The cost of each pizza cutter is $4 ($4/each).

JE 6 PizzaPan Inc. paid their employees as follows:

Sales staff => $12,000

Administrative staff => $16,000

JE 7 PizzaPan Inc. received $50,000 payment from Dominos Corporation.

2. Post the above journal entries to T accounts.

3. Prepare a trial balance using the T account balances.

4. Prepare an Income Statement.

5. Prepare a Retained Earnings Statement

6. Prepare a Balance Sheet

JE 1 PizzaPan Inc. sold 1 million shares of their common stock for $1/share (par value of the common stock is $.10) JE# Account Descriptions Debit Credit 1 Cash $ 1,000,000 Common Stock APIC $ 100,000 $ 900,000 JE 2 PizzaPan Inc. purchased $200,000 inventory from a culinary distributor. PizzaPan inc. had to pay at the point of purchase the full $200,000 (cash). JE# Account Descriptions Debit Credit ri 2 Inventory $ 200,000 Cash $ 200,000 Assets Liabilities Stockholders' Equity Accounts Receivable Common Stock Retained Earnings Cash JE 1 $ 1,000,000 $ 200,000 JE 2 100,000 JE 1 Additional Paid-In Capital 900,000 JE 1 ventory 200,000 JE2 $ Income Statement Accounts Sales COGS Wage Expense - Selling Wage Expense - Admin. JE 1 PizzaPan Inc. sold 1 million shares of their common stock for $1/share (par value of the common stock is $.10) JE# Account Descriptions Debit Credit 1 Cash $ 1,000,000 Common Stock APIC $ 100,000 $ 900,000 JE 2 PizzaPan Inc. purchased $200,000 inventory from a culinary distributor. PizzaPan inc. had to pay at the point of purchase the full $200,000 (cash). JE# Account Descriptions Debit Credit ri 2 Inventory $ 200,000 Cash $ 200,000 Assets Liabilities Stockholders' Equity Accounts Receivable Common Stock Retained Earnings Cash JE 1 $ 1,000,000 $ 200,000 JE 2 100,000 JE 1 Additional Paid-In Capital 900,000 JE 1 ventory 200,000 JE2 $ Income Statement Accounts Sales COGS Wage Expense - Selling Wage Expense - Admin