Record adjusting entries in separate parts

Reference no: EM132213330

Question: DH Corporation (DHC) was founded in 2000 by Eric Conner and Phil Martin. The company designs, installs, and services security systems for high-tech companies. The founders, who describe themselves as "entrepreneurial geeks," met in a computer lab when they were teenagers and found they had common interests in working on security systems for critical industries. In early January 2018

CMC anticipates growth potential for its products. As a result, it is planning a new public offering of their common stock at the end of 2018. The accounting department is currently quite small and the CFO has requested additional staff to help keep pace with the company's fast-paced growth. Therefore, as an accounting intern you can immediately become a valuable member to their corporate accounting team. To familiarize you with the company's operations, the CFO has provided an unadjusted trial balance from the end of their last fiscal year (2017) on an Excel spreadsheet.

Instructions

(a) Download the excel file which has the unadjusted trial balance with the existing accounts. This file also contains an accounting system comprised of a series of linked spreadsheets. The linkages enable the effects of all accounting entries (journal, adjusting, and closing) to flow through the spreadsheets to update the income statement, balance sheet, and retained earnings. You notice that for the fiscal year ended December 31, 2017, the bookkeeper has made all the routine general journal entries throughout the year, but none of the adjusting or closing entries have been recorded.

(b) The following information is provided for adjustments prior to closing the books. The CFO asks you to enter the adjustments into the spreadsheet using the tab labeled AJE's & Closing Entries. Also post these adjustments to the Trial Balance in the two columns to the right of the unadjusted trial balance. (CMC uses a perpetual inventory system.) You MUST use cell referencing when posting to the Trial Balance or your grade will be assessed a 10 point penalty.

Adjusting Journal Entries (AJE):

Wages earned by employees during December ('17) and to be paid in January ('18) are $32,875; associated payroll taxes on these wages are $1,910. (Record in two separate adjusting entries. The payroll taxes are an expense to the company for unemployment benefits and recorded as a payable to the state & federal taxing authority.)

Reference no: EM132213330

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