ISLAND VIDEO PRODUCTIONS
A Sole Proprietorship Service Business
College Accounting: A Contemporary Approach 5th edition
Haddock ▪ Price ▪ Farina
(further adapted for use in ACC100)
Project #1 Outcomes Part III:
From chapter 2 & 3
Prepare an Income Statement, Statement of Owner’s Equity and Balance Sheet.
Related to Essential Employability Skills
Demonstrate verbal, written and/or digital communication skills.
Demonstrate working with others to complete goals & assignments.
Demonstrate ability to analyze and address problems; generate and evaluate solutions; and implement the appropriate solution for the use.
Total 20 points for Parts III
REQUIRED FOR POINTS for Part III - (A) Financial Statements & (B) Analysis Presentation & Reflection:
To prepare the financial statements, the following steps must be completed:
Using the graded and corrected results from Part II (It is beneficial to prepare an unadjusted Trial Balance at this point), and the following information, record the adjusting journal entries. You can use the journal form from Part II, create a new page if needed, or open the Part II file and save as a new document.
a. Videography Supplies on hand June 30 are $156.00
b. Unexpired Insurance is $300.00
c. Depreciation is computed using the straight-line method.
Computer equipment (June 1 purchase) has an estimated life of 3 years (36 months) with no salvage value.
The SUV (June 5) has an estimated life of 5 years (60 months) with a $1,700 salvage value.
Equipment (June 8 and 9 purchase) has an estimated life of 3 years (36 months) with no salvage value. Depreciation can be calculated together for this equipment
***For simplicity, round the monthly depreciation to whole dollars and consider each of the three categories to be a full month of depreciation.
Note: Ignore equipment purchased after the 10th of the month. No depreciation will begin on those items until the following month.
Using the adjusted totals for each account (It is beneficial to prepare an adjusted Trial balance at this point), the 3 common Financial statements must be prepared in good form. The appropriate correct format can be found on slide 43, 44 & 46 in chapter 5 and Figure 5.5, 5.6 and 5.7 in the e-text..
A blank sheet/tab has been provided to start the process on a second tab of the journal entry form (Part II).
