Performance Task $1$

BERRIGAN ENTERPRISES

What Learning You Will Demonstrate

You will:

demonstrate an understanding of the recording and decision$-$making aspects of accounting for a service company;

demonstrate an understanding of the basic accounting cycle procedures and principles for a service business, without adjusting and closing entries;

demonstrate an understanding of the debit$/$credit theory in recording transactions in the journals and the ledgers of a service business; and

demonstrate the skills necessary to prepare a trial balance, a six$-$column work sheet, and the financial statements of a service business f without adjustments$).$

The Business

Linda Berrigan operates a real estate agency that earns money from three sources:

commissions on sales of property;

property management fees; and

investment income.

The agency earns management fees from renting and maintaining homes and condominiums for owners who lease their properties to tenants. Berrigan has invested past net income $($profits$)$ in stocks and bonds. Interest and dividends received on these investments are recorded in the Investment Income account.

The Task

You have been hired as the accountant for Berrigan Enterprises. The company has not had an accountant for a month. You are given the transactions for May and asked to bring the records up to date.

Suggested Procedure

Set up a general ledger with the appropriate accounts and balances.

Journalize and post the May entries.

Prepare a trial balance and a work sheet.

Prepare an income statement, a statement of owner's equity, and a classified balance sheet.

Materials Required

May financial information

Forms for the journal, the ledger, the work sheet, and the financial