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Instructions: Use the Information shown below and the Bright Landscape Practice Set Excel Workpapers attached to complete Bright Landscapes accounting cycle for the month of July, 2017 by:

1. Recording the transactions (on page 5 of this packet) in the general journal (Sheet 1 of excel). 2. Posting the above journal entries to the general ledger accounts (Sheet 2 of excel) and totaling each account. 3. Preparing an unadjusted trial balance at July 31, 2017 on the worksheet (Sheet 3 of excel) by taking the totals from the general ledger accounts. 4. Recording and posting the adjusting journal entries (information on page 7 of this packet) in the general journal (Sheet 1 of excel) and the general ledger accounts (Sheet 2 of excel). 5. Completing Bright Landscapes worksheet (Sheet 3 of excel), including an adjusting trial balance, income statement and balance sheet. 6. Preparing July 31, 2017, financial statements: a. Income Statement b. Statement of Retained Earnings c. Balance Sheet

Students should first prepare the approximately 10 necessary journal entries (Information on page 5 of this packet) for the month, post them and prepare the unadjusted trial balance BEFORE preparing the adjusting entries. You should use the adding mechanisms through excel to add and complete the worksheet, and the related financial statements.

An appropriate adjusting entry to record cost of goods sold is required. The perpetual inventory method is to be used, but inventory is not adjusted for each sale. It is only necessary to adjust inventory at the end of the month. (The entry at the end of the month would be a debit to cost of goods sold and a credit to inventory.)

Background:

In march 2001, a group of individuals formed the Bright Landscapes Corporation. At the time of incorporation, Bright was given authorization to sell 100,000 shares of common stock with a $4 par value. As of June 30, 2017, 15,000 shares were issued and outstanding.

The goal of Bright Landscapes is to provide quality trees and shrubs, as well as law and garden tools, to its customers at low prices. To keep these low prices, Bright sells the landscapes materials but does not provide planting services. Although Bright as some over-the-counter cash sales of merchandise to individuals, its largest amount of business results from credits sales to contractors and businesses.

Bright has a calendar year end, however, a one month period of time will be used in this practice set with adjusting entires prepared at month end of July 31,2012. Bright uses a perpetual inventory system, but will record the cost of items sold at the end of the month through an adjusting entry. Not all accounts will have transactions in the month of July.

PAGE 2 Below is the post-closing trial balance at June 30, 2012:

Bright Landscapes, Inc. Post-Closing Trial Balance 6/30/2012

Debit Credit Cash $15,000 Accounts Receivable $64,850 Allowance for Bad Debts $4,900 Inventory $41,250 Prepaid Insurance $4,680 Office Supplies $695 Land $130,000 Property, Plant, Equip. $240,000 Accumulated Depreciation $107,000 Accounts payable $16,300 Interest Payable $1,725 Notes Payable $115,000 Common Stock $60,000 Pain Capital in Excess of Par $139,355 Retained Earnings $52,195

Totals $496,475 $496,475

PAGE 3 Chart of Accounts for Bright Landscapes:

Acc. No. Name Acc. No. Name Assets: Liabilities and Equity: 101 Cash 210 Accounts Payable 110 Account Receivable 221 Interest Payable 111 Allowance for Bad Debts 245 Notes Payable 120 Inventory 301 Common Stock 130 Prepaid Insurance 305 Paid in Capital in Excess of Par 131 Prepaid Rent 330 Retained Earnings 135 Office Supplies 150 Land 160 Property, Plant, and Equip. REVENUES: 170 Accumulated Depreciation 401 Sales Revenue 402 Sales Returns and Allowances EXPENSES: 403 Sales Discounts 501 Cost of Goods Sold 410 Interest Income 502 Purchase Discounts 503 Purchase Returns and Allowances 506 Advertising Expense 507 Wages Expense 511 Depreciation Expense 513 Bad Debt Expense 514 Utilities Expense 516 Insurance Expense 517 Rent Expense 518 Office Supplies Expense 519 Repair Expense 522 Interest Expense

PAGE 4 Other Pertinent Information about Bright Landscapes.

Accounts Receivable at June 30, 2017

Customer Date of Sale Amount

Andersons Rentals 9/21/2016 $3,000 Bluegrass Property 5/21/2017 $10,700 Elaine and Sons 6/23/2017 $16,450 Grilled Steaks 6/10/2017 $12,450 Jenkins and Sons 4/9/2017 $8,850 Smith and Jones 3/2/2017 $9,150 Watson Properties 6/28/2017 $4,250

Total $64,917

Accounts Payable at June 30, 2017

Vendor Invoice Date Amount

Chesterfield Office Supplies 6/5/2017 $750 His Garden Ship 6/23/2017 $3,550 Smithville Nurseries 6/28/2017 $7,250 National Telephone 5/25/2017 $4,750

Total $16,300

PAGE 5 Record the journal Entries for the following transactions for the month of July, 2017:

July 2 Sold 10,000 additional shares of common stock for $8.50 per share July 2 Paid monthly rent of $250 July 2 Paid cash for inventory $13,500

July 5 Purchased office supplies on credit from Chesterfield Office Supplies $1,000 terms 2/20, n/30, invoice #940 July 5 Paid $8,500 on Note Payable, plus interest accrued at 6-30.

July 10 Sold Merchandise on credit to Bowling Company, $14,200 terms, 2/15, n/30 invoice 1948 July 10 Paid electricity bill of $250

July 15 Sold Merchandise on credit to Watson Properties $3,500, terms 2/10, n/30. invoice #999

July 22 Received payment from Bowling Company for merchandise sold on July 10

July 22 Paid for office supplies on July 5.

July 26 Paid for inventory purchased on credit from Smithville Nurseries

July 31 Cash sales for the month of $4,200.

PAGE 6 Information for adjusting entries:

Note Payable at June 30, 2017:

The payee is Quality Bank, with an original principal of $200,000 but the current amount owed at July 30,2017 is $120,000. Interest is payable each six months at a 3% rate and interest has been accrued at June 30 of $1,725. Interest is charged on the unpaid note.

Prepaid Insurance at June 30, 2017:

Type Length Amount

Truck 1/01/2017 to 1/01/2018 $1,600 Property 9/01/2016 to 9/01/2017 $880 Liability 8/01/2016 to 8/01/2017 $1000 Workers Compensation 4/01/2017 to 4/01/2018 $1,200

Property, Plant, and Equipment at June 30,2017:

All property, plant, and Equipment is depreciated using the straight line (with no estimated salvage value).

Record the adjusting journal entries based on the following information

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Record the Adjusting Entries based on the following Information:

Adjusting Entries:

1. Record one month interesting (for July) due to the bank for the note payable.

2. If applicable, expense one month of prepaid office rental space.

3. Expense one month of prepaid insurance

4. The count of office supplies indicated $240 left in supplies inventory

5. It has been determined that a total of $12,400 of Accounts Receivable are considered to be uncollectible

6. The physical count of inventory of merchandise shows $41,575 still in merchandise inventory

7. Prepare the depreciation expense entry for the month of July assuming the Property, Plant and Equipment is depreciated over 27 years