REQUIRED $($please read the REQUIRED $($please read the entire document before starting the project$)$

Aentire document before starting theREQUIRED $($please read the entire document before starting the project$)$

A project$)$

Analyze and review the following items $($a $$ t$)$ and determine the appropriate journal entry, if

any, required. Record the appropriate journal entry in the Excel tab labelled $$journal entries$.$ In

the explanation line $$ it may be helpful to reference the transaction item. Use the various tabs in

the Excel file to perform calculations and use the tabs as support for your journal entries,

financial statement preparation, and notes to the financial statements.

Read the transactions below very carefully and the requirements that follow.

This project accounts for $20\%$ of your final grade and is due on Sunday April $7,2024$

@$11$:$59$ pm$.$

You should complete this project on your own but please ask questions as you progress through

the project. If there is time, virtual classes may be allocated to questions related to the project.

NOTE $$ before you begin the Excel work, enter your student ID number on the Excel tab

$$Students First Step$$ as indicated.

See the $$REQUIRED$$ section below for important information.

$1$

ACCT $3050$ Intermediate Accounting $2$: Winter $2024$ PROJECT

TRANSACTIONS NOT INCLUDED IN THE UNADJUSTED TRIAL BALANCE at

DECEMBER $31,$ Y$6$:

a$.$ Unearned Revenue

Aylmer has some customers that pay for services in advance of work started. At December $31,$

Y$6,$ the accountant reviewed unearned revenue to see how much revenue had been earned.

In the Excel spreadsheet, see the tab labelled $$Unearned Revenue$$ for details relating to

unearned revenue and to make any calculations for an adjusting journal entry.

b$.$ Vacation Pay

Aylmer has $11$ full$-$time employees.

Each employee earns vacation pay at a different rate. Vacation pay, for days earned, may be

taken after January $15$th of the year following the year in which the days are earned $($in other

words, vacation days earned in Y$6$ must be used in Y$7).$ Aylmer has chosen to accrue the cost of

vacation at rates of pay in effect during the period in which they are earned, at Y$6$ rates of pay.

The expense for Y$6$ should be based on Y$6$ wages and no expense or liability for Y$6$ has been

recorded.

There is NO carryover of vacation pay from Y$5$ to Y$6$ any liability from Y$5$ was used in Y$6.$

In order to calculate the vacation pay, to be expensed in Y$6,$ salaried employees are paid weekly

and hourly employees are normally paid $40$ hours per week.

In the Excel spreadsheet, see the tab labelled $$Vacation Pay$$ to make any calculations for an

adjusting entry.

c$.$ Bonus Accrual

Aylmer has a bonus package for several employees. Bonus$$ are paid in February of the

following year $($February Y$7)$ based on a number of criteria. Some employees earned a bonus

for Y$6$ results. No expense or liability for Y$6$ has been recorded.

In the Excel spreadsheet, see the tab labelled $$Bonus Accrual$$ to make any calculations for an

adjusting entry.

d$.$ Warranties

Aylmer uses the service$-$type warranty $($revenue$-$based approach$)$ to account for any necessary

adjustments to warranty related items. Entries for Y$4$ and Y$5$ have been made in the appropriate

years. No adjusting entry for total unearned warranties earned during Y$6$ has been made.

In the Excel spreadsheet, see the tab labelled $$Warranties$$ to make any calculations for an

adjusting journal entry.

$2$

ACCT $3050$ Intermediate Accounting $2$: Winter $2024$ PROJECT

e$.$ Pension Plans

Aylmer has two pension plans for employees:

Defined Contribution Plan: For this plan, payments are made to the plan in January for the prior

year. Aylmer contributes to this plan, on behalf of the qualified employees. The employees do

not contribute. A payment will be made in January Y$7$ for all of the Y$6$ defined contribution

pension related expenses. Remittances are only required to be made annually as is the

corresponding accrual. The entry for accruing the pension expense for Y$6$ is to be made in

December Y$6.$

In the Excel spreadsheet, see the tab labelled $$Defined Contribution Plan$$ for calculations.

Defined Benefit Plan: For this plan, NOTE $$ for Y$6,$ the payment and expense have not been

recorded on the trial balance.

In the Excel spreadsheet, see the tab labelled $$Defined Benefit Plan$$ for calculations and

requirements for reconciling the pension amounts.

f$.$ Notes Payable

This is a short$-$term note. The company borrowed money from JRT Investments on October $31,$

Y$6$ for $3$ months. The principal, along with interest is to be repaid on January $31,$ Y$7.$ The

interest rate is $3\mathrm{.}60\%.$ Note $$ there is no tab in the excel file for this item. Use the journal entry

tab to make any necessary calculations.

g$.$ Leased Asset

On January $1,$ Y$6,$ Aylmer decided to lease a machine. The accountant at the time did not know

how to record this asset $($the accountant did not take Intermediate Accounting $2$ at Fanshawe!$).$

NO TRANSACTIONS relating to leases were recorded. The following information pertains

to the leased machine:

$$ The lease term is $6$ years and the economic life of the asset is $7$ years