Accounting 307 final project part 2

 Overview: In your final project, you will assume the role of an accountant and complete the year-end adjustment process for your company using a provided workbook. This workbook is the first deliverable (Part I) of your final project. In Part II, you will analyze the provided financials of the same company and create a report documenting your findings. For your third milestone, you will complete a draft of your ratio analysis report so that you can gain feedback and improve your work prior to the final submission in Module Eight. Note that you do not need feedback from Milestone Two to successfully complete this assignment. You should use the provided Final Project Part II template to structure your submission. Prompt: Specifically, the following critical elements must be addressed: I. Abstract: Summarize the story of profitability and liquidity for your company. In other words, highlight the most important aspects of your report, including your major conclusions. II. Computations: Identify and describe your computations from the Financial Analysis tab of your workbook. Be sure to format your key results in a table or graphical format, as appropriate. Explain why each cited figure was included in your report in terms of its importance for the organization. III. Comparison: Evaluate the financials of the company by comparing current ratios to both historical and industry-average ratios. Clearly identify all unexpected or aberrant figures. IV. Conclusion: Draw informed conclusions based on your computations and comparisons in the previous paragraphs. Be sure to justify your claims with specific evidence and examples. Rubric Guidelines for Submission: Your ratio analysis report must be 2–3 pages in length (plus a cover page and references) and written in APA format. Use double spacing, 12-point Times New Roman font, and one-inch margins. All references must be cited in APA format.  

DELETE ALL TEXT IN ITALICS

Review the Final Project Guidelines and Rubric document to see how your paper will be scored.

Be sure to follow APA format when providing references. If you have questions on APA formatting, you can check the

Purdue OWL website

or seek help from the

SNHU Writing Lab

.

Notes on APA in a Formal Assignment

Use one-inch margins on all sides.

Use 12-point Times New Roman font with double spacing.

Paragraphs should be at least five to six sentences in length.

Do not include the headings “Introduction” and “Conclusion.” These are included below to help you lay out your paper. APA format assumes that the introduction begins the paper, the body continues the paper, and the conclusion wraps up the paper, so those headings are not needed.

Indent the first line of every paragraph by 0.5”.

Be careful not to use personal pronouns such as “I.”

Make sure to delete headings such as Paragraph One, Paragraph Two, and so on.

Be sure to replace all of the text in italics with your own writing, which should not be in italics. (This entire first page can be deleted after you review the guidelines. Your paper should begin with the title page that follows.)

ACC 307 Final Project Part II: Ratio Analysis Report

[Your Name]

Southern New Hampshire University

REMEMBER: DELETE ALL TEXT IN ITALICS
Abstract (Delete this heading in your final paper)

In your opening paragraph, summarize the overall story of profitability and liquidity for your company. In other words, highlight the most important aspects of your report, including your major conclusions.

Paragraph One: Computations (Delete this heading in your final paper)

In your first body paragraph, complete the computations portion of your report: Identify and describe your computations from the Financial Analysis tab of your workbook. Be sure to format your key results in table or graphical format, as appropriate. Explain why each cited figure was included in your report in terms of its importance for the organization.

Comparison Ratios:

2017

2016

2015

Industry Standard

Quick Ratio

Gross Margin

Net Margin

Return on Equity

Paragraph Two: Comparison (Delete this heading in your final paper)

In your second body paragraph, complete the comparison portion of your report: Evaluate the financials of the company by comparing ratios to both historical and industry-average ratios. Clearly identify all unexpected or aberrant figures.

Paragraph Three: Conclusions (Delete this heading in your final paper)

In your third body paragraph, draw informed conclusions based on your computations and comparisons in the previous paragraphs. Be sure to justify your claims with specific evidence and examples.

References

Wahlen, J. M., Jones, J. P., & Pagach, D. P. (2017). Intermediate accounting: Reporting and analysis (2nd ed.). Boston, MA: Cengage Learning.

Make sure that you provide appropriate in-text citations in APA style with the author’s name and year of publication (Author last name, year). The textbook is provided as an example and should be kept in the references for your paper. Feel free to add other resources. To add credibility to your paper, remember to cite ALL of the sources within the body of the paper, as well as in the References list at the end. References should be in alphabetical order by the author’s last name.

Chart of

Account

s

Acct # Acct #

Acct #

Acct #

																																																																																																																																																																																																																																																																																																																																																																																																																																																																																																																																																											Asset		Accounts	Liability Accounts	Equity Accounts
				Acct #
		Cash	101			Notes Payable	201			Common Stock	301
		Baking Supplies	102			Accounts Payable	202		Dividends	302
		Prepaid Rent	103			Wages Payable	203
		Prepaid Insurance	104			Interest Payable	204
		Baking Equipment	105			Loans Payable	205
		Office Supplies	106
		Accounts Receivable	107
	Accumulated Depreciation	108
		Trademark	109
		Leasehold Improvements	110
	Accumulated Amortization	111
Revenue Accounts
This chart of accounts should help you identify the appropriate accounts to record to as you are analyzing and journaling transactions for this workbook. There is nothing to complete on this page; this is simply a resource for you.
			Bakery Sales	401
			Merchandise Sales	402
Expense Accounts
				Baking Cost of Goods Sold	501
		Merchandise Cost of Goods Sold (FIFO)	502
			Rent Expense	503
				Insurance Expense	504
			Misc. Expense	505
			Business License Expense	506
			Advertising Expense	507
				Wages Expense	508
			Telephone Expense	509
				Interest Expense	510
				Depreciation Expense	511
				Amortization Expense	512
				Office Supplies Expense	513

Worksheet

Account

Debit Credit Debit Credit

Cash

64,713.72

Baking Supplies

25,750.00

Prepaid Rent

7,500.00

Prepaid Insurance

400.00

Baking Equipment

17,000.00

Accumulated Depreciation

6

Leasehold Improvements

10,000.00

Accumulated Amortization 2,000.00 2,000.00

Trademark

2,300.00

Office Supplies

250.00

Accounts Receivable

30,401.00

Notes Payable 10,000.00 10,000.00
Interest Payable

1,468.75

Accounts Payable

27,325.00

Wages Payable

22,800.00

Loans Payable

21,000.00

Common Stock

30,000.00

Dividends

20,000.00

Bakery Sales

335,675.00

Merchandise Sales

Baking Cost of Goods Sold

137,400.00

Rent Expense

90,000.00

Interest Expense 1,468.75 1,468.75
Insurance Expense 2,000.00 2,000.00
Depreciation Expense 2,642.86 2,642.86
Amortization Expense 2,000.00 2,000.00
Misc. Expense

2,780.00

Office Supplies Expense 1,350.00 1,350.00
Business License Expense

375.00

Advertising Expense 5,200.00 5,200.00
Wages Expense 22,800.00 22,800.00
Telephone Expense

3,456.00

15,760.00

464,485.72

169,661.61

493,397.33

					Peyton Approved
Trial Balance
		2017
Unadjusted trial balance	Adjusting entries	Adjusted trial balance
				Debit					Credit
		64,713.72
165,		250.00	137,		400.00		27,850.00
	Merchandise Inventory (FIFO)			25,750.00
		7,500.00
2,400.00															2,000.00
		17,000.00
3,285.72						2,64	2.8		5,928.58
					10,000.00
	4,000.00
		2,300.00
1,600.00							1,350.00
		30,401.00
								1,468.75
		27,325.00
								22,800.00
		21,000.00
		30,000.00
				20,000.00
		335,675.00
	3				5,200.00	35,200.00
					137,400.00
			90,000.00
			2,780.00
			375.00
			3,456.00
Merchandise COGS (FIFO)				15,760.00
Total		464,485.72				169,661.61		493,397.33

Adjusting Entries

Peyton Approved

2017

Accounts Debit Credit

Depreciation Expense 2,642.86

2,642.86

31-Dec Amortization Expense 2,000.00

2,000.00

31-Dec Interest Expense 1,468.75

1,468.75

31-Dec Insurance Expense 2,000.00

2,000.00

31-Dec Baking Cost of Goods Sold 137,400.00

137,400.00

31-Dec Office Supplies Expense 1,350.00

1,350.00

31-Dec Wages Expense 22,800.00

22,800.00

169,661.61 169,661.61

Adjusting Journal Entries
	Date
										31-Dec
Accumulated depreciation
	Accumulated Amortization
Interest Payable
Prepaid Insurance
Baking Supplies
Office Supplies
Wages Payable

Income Statement

Peyton Approved

Income Statement
Bakery Sales

Merchandise Sales

Merchandise Cost of Goods Sold (FIFO) 15,760.00
Baking Cost of Goods Sold 137,400.00
Rent Expense 90,000.00
Interest Expense 1,468.75
Insurance Expense 2,000.00
Depreciation Expense

Amortization Expense 2,000.00
Misc. Expense 2,780.00
Office Supplies Expense 1,350.00
Business License Expense 375.00
Advertising Expense 5,200.00
Wages Expense 22,800.00
Telephone Expense 3,456.00

		For Year Ending 12/31/2017
$ 335,675.00
$ 35,200.00
Total Revenues		370,875.00
Gross Profit	217,715.00
Operating Expenses:
2,642.00
Total Operating Expenses:	134,07	1.75
Net Income	83,643.25

Closing Entries

Peyton Approved

For Year Ending 12/31/2017

Date Accounts Debit Credit

31-Dec Bakery Sales 335,675.00
Merchandise Sales 35,200.00

370,875.00

31-Dec Income Summary

Baking Cost of Goods Sold 137,400.00
Rent Expense 90,000.00
Interest Expense 1,468.75
Insurance Expense 2,000.00

Depreciation Expense 2,642.86

Amortization Expense 2,000.00
Misc. Expense 2,780.00
Office Supplies Expense 1,350.00
Business License Expense 375.00
Advertising Expense 5,200.00
Wages Expense 22,800.00
Telephone Expense 3,456.00
Merchandise Cost of Goods Sold (FIFO) 15,760.00

31-Dec Income Summary

83,642.39

31-Dec Retained Earnings 20,000.00

20,000.00

761,750.00

Closing Entries
		Income Summary
287,232.61
	83,642.39
	Retained Earnings
Dividends
	761,750.00

Statement of Retained Earnings

Peyton Approved

Statement of Retained Earnings

For Year Ending 12/31/2017

20,000.00

Beginning Balance:	– 0
plus Net Income		84,642.00
less Dividends:
Ending Balance:	64,642.00

Balance Sheet

Peyton Approved

Balance Sheet
Cash 64,713.72 Accounts Payable 27,325.00
Baking Supplies 27,850.00 Wages Payable 22,800.00
Merchandise Inventory (FIFO) 25,750.00 Interest Payable 1,468.75
Prepaid Rent 7,500.00

Prepaid Insurance 400.00
Office Supplies 250.00

Accounts Receivable 30,401.00 Notes Payable 10,000.00

Loans Payable 21,000.00

Baking Equipment 17,000.00 Common Stock 30,000.00

5,928.58

84,642.00

Leasehold Improvements 10,000.00

Accumulated Amortization 4,000.00

Trademark 2,300.00

As of December 31, 2017
Assets	Liabilities and Owners’ Equity
Current Assets:	Current Liabilities:
Total Current Liabilities	51,593.75
Long Term Liabilities:
Total Current Assets	156,864.72
Total Long Term Liabilities:	31,000.00
Total Liabilities:	82,593.75
Long Term/Fixed Assets:
Accumulated Depreciation	Retained Earnings
11,071.42
Total Equity	114,642.00
6,000.00
Total Assets:	176,236.14	Total Liabilities & Equity	176,236.00

Financial Analysis

2017

2.8 1.75

0.7

9

0.8

2016	2015	Industry Standard
Quick Ratio	1.66	2.2
Gross Margin	0.59	0.55		0.7
Net Margin	0.23	0.22	0.32	0.24
Return on Equity		0.8	0.9	0.78