Reference no: EM131053629

There are two components to this 40 total point Comprehensive Problem -

Part A (this assignment) - is worth 10 points allocated to the submission of a correct trial balance as discussed in this handout.

Part A includes Steps 1 -11 given below, and covers Quickbooks' methods and procedures to establish the Chart of Accounts, set up Vendors and Customers, issue Purchase Orders (POs) to vendors and Invoices to customers, Receive Inventory and Customer Payments and make Payments to Vendors.

You will not make any Journal Entries in Part A because in the real world the vast majority of the daily entries are automatically generated by the accounting system. For example, when an invoice is generated to a customer (and a perpetual inventory system is being used, which is the default in Quickbooks), the two entries which you studied in Chapters 5 & 6 (i.e. dr. COGS and cr. Inventory and dr. A/R and cr. Sales) are automatically recorded in the journal and posted to the general ledger. Thus it is imperative that you establish correct G/L accounts when establishing inventory items, customers, etc. in order to have appropriate entries generated by the system.

Part B (described in a separate handout)- is worth 80 points (50 points allocated to the correctness of documents required to be submitted, and 30 points allocated to questions for which you will once again submit your answers in the quizzes section in D2L).

In part B you willbe required to make Journal Entries, Adjusting Journal Entries and prepare a Bank Reconciliation

Keep this Part A document as Part B will refer to it.

General Information

A. Load the "Quickbooks Comprehensive Problem" template onto your computer by performing the same steps you previously used for the prior QB problems (these steps are repeated for you below).

1. The Quickbooks templates are found in the "Content" section (under "QuickBooks Documents") in D2L. Due to size and nature of the file it had to be "zipped" (i.e. compressed) in order for you to be able to download it. You cannot directly load a zipped file into Quickbooks and thus you must unzip the file once you download it onto your computer in order to upload it from your computer into Quickbooks.

Find the Quickbooks "Comprehensive Problem" Template and download the zipped file to your computer. You will then need to unzip the file using the following instructions:
To extract files or folders from a compressed folder:
a. Locate the compressed folder that you want to extract files or folders from.
b. Do one of the following:

o To extract a single file or folder, double-click the compressed folder to open it. Then, drag the file or folder from the compressed folder to a new location.
o To extract the entire contents of the compressed folder, right-click the folder, click Extract All, and then follow the instructions.
2. Start Quickbooks (if not already open).

3. If a company opens, click File, Close Company (the menu is on the upper left hand side of the page). The Quickbooks startup window [a dialog box entitled "No Company Open" should be in the window]

4. Click "Open or restore an existing company". The "Open or Restore Company" dialog box should appear. Select the radio button entitled "Restore a backup copy". Click "Next", then select "Local Backup", then click "Next".

5. In the "Look in" field, select the location of the Quickbooks Comprehensive file (which you had just saved to your computer).

6. Click the Quickbooks Comprehensive file [the extension should be something like SiestaCompany.qbb"] to select it. Click "Open".

7. The "Where do you want to restore the file?" dialog box should appear. Click on "Next" and the location of the Quickbooks files should appear. Give the file an appropriate name (if not present) and then click "save".

• It is very possible that the Quickbooks file you are attempting to open was generated in an earlier version (e.g Quickbooks 2013) then the version you are using now (this was done to allow students who might have purchased Quickbooks in an earlier semester to still use that software). So...you might get a message something like "I understand that my company file will be updated to this new version of Quickbooks? Check the box and then select "Update Now", and continue through another similar screen (e.g. "You are about to open a company file....." Do you want to continue? Select Yes) if prompted.

8. The Quickbooks homepage should now appear [the main figure is a flow chart, with "Vendors" , and then "enter bills" "pay bills", etc appearing on the flow chart. The company name for the problem should now be on the top of this homepage.

9. In order to receive full credit for the problem you need to add your name to the company name. To add your name to the company name -

• On the tool bar at the top of the page click on "Company", then
• Select "My Company", then
• Click on the pencil (edit) icon on the right-hand side of the window, then
• Add your name to the company name so that it appears similar to "XXX Company - Jane Doe", then select "OK"
• On the QB homepage your name should now appear in the title of the company.
• You can "x-out" the "What's New" icon if you so desire, and then x-out of this screen.

10. See the "Problem Information" given below for the assignment requirements.
Purpose of this problem, and the related procedures:

1. This problem is designed to:

• Provide you with knowledge and experience in the "credit purchases" and "credit sales" cycles as performed in a G/L package, and to

• Provide a review of the key concepts covered in the Bus1125 - Financial Accounting course, including

o Adding (and properly classifying) accounts to the "chart of accounts",

o Analyzing, and recording, day-to-day transactions in the accounting journals. These transactions include:

? credit purchases of inventory, and subsequent payments

? credit sales of inventory, and subsequent receipts

2. Credit purchases and credit sales of inventory:

(a). "Journal" entries are not made in the general journal, rather entries are generated:

• through the issuance of a Purchase Order to a vendor and subsequent receipt of inventory against that PO (purchase order)
• through the establishment of a Sales Order for a customer when a customer PO is received, and subsequent sales invoicing upon shipment of goods to the customer. --

(b). To be able to purchase and sell inventory you will be required to perform the following:

• Establish inventory items
• Set-up vendors
• Issue purchase orders to vendors
• Receive inventory (against the issued purchase order) when it arrives at the receiving dock
• Record invoices received from vendors (by vouching the receipt made against the purchase order)
• Pay the vendor invoice
• Set-up customers
• Set-up a sales order to a customer (upon receipt of a PO from that customer)Issue a sales invoice to a customer (from the sales order that was established)
• record cash receipts from customers(against an outstanding sales invoice)