ACCT 100 – Fundamentals of Acct. - Schmidt
Mini Practice Set 2 – Using QuickBooks
Sign in Instructions: Do not sign in with your regular Cerritos College Account. You must use a special quickboooks log in. Use “accounting” as the user name and password. Choose the Log Into option that says Cerritos.
Why are we doing this?
The purpose of this assignment is two-fold. The completion of the Mini-Practice Set 2 on pages 453-457 of your text will assist you in the review of the materials covered in the merchandising chapters in your book. Secondly, it will reinforce the basics of a very popular software accounting package called QuickBooks Pro (2011) which we first used on the other mini-case. It’s also GREAT PRACTICE to insure you are ready for the next exam.
What you need to Start!
You should have your text opened to the problem. You should have a pen or pencil. Most importantly, you should have a flash drive /USB with your name on it. You will need to download two files from my website as follows:
Downloading Instructions
· Locate my website using Internet Explorer. My website address is: www.cerritos.edu/dschmidt.
· Use the “Course Materials” Link.
· Choose your class à ACCT 100.
· Scroll Down until you see Comprehensive Accounting Cycle Review Problem “QuickBooks File” (The Fashion Rack, located after the chapter 13 handouts.)
· RIGHT CLICK (not left click like you are used to) on the file and a menu will come up.
· Choose “Save Target As” and change the directory to the drive where your flash drive is located. (This is usually drive F or G.) Then press the Save button. The file will be saved on your flash drive.
· Next, download and save the Excel file (for the worksheet) by following the same directions. Right click and choose “Save Target As” and then save that file to your flash drive as well.
· After you have downloaded the files, close out the download, and then get out of the internet.
I have gone through all the set up procedures that are required in the QuickBooks program. I have also set up your chart of accounts for you. You will need to customize the company, prepare journal entries, and print out the necessary reports. The directions for these procedures are as follows:
Getting Started:
From the Desktop, double click on the QuickBooks Pro 2011 icon. You will be offered a choice of options by the program. Choose bubble in the middle of the screen that says “Open or restore an existing company”, then choose “Open a company file” and click “Next” and then when you get the "Open a Company” dialog box, you will be prompted for the location of the file. Change the directory to be the “ F or G Drive" -- wherever your flash drive is located. (Click on the drop down box and choose the correct Drive.) After the contents of the drive is displayed, double click on the The Fashion Rack Quickbooks file, and the QuickBooks program will open. (It may take a minute or two. Don’t get impatient.)
You now need to customize your company. Go to the Company menu item and choose “Company Information.” Put your last name in front of The Fashion Rack………. For example, after completing this step, my file name would read “Schmidt’s Fashion Rack.” This will insure your name is on your printouts. If you have a partner, make sure both names are included in this step.
Record Journal Entries
Now you are ready to record Journal Entries for the transaction. Go to Company Menu, then choose “Make General Journal Entries.” You will get a message about assigning numbers to journal entries. (Don't worry if your JE's don't start with number 1.) Check the box that says "do not display message in the future" and click OK.
MAKE SURE YOU CHANGE THE DATE to match the textbook!!! Use the year 2013 ON ALL TRANSACTIONS!
We will only be using the accounts given in the problem. Do not create any new accounts. All of these accounts have been entered into Quick Books. Use the drop down menus to pull up the correct account names. You may find the Chart of accounts helpful. It is listed on pages 453/454 of your text. Use the mouse or the tab keys to enter the proper amounts and to enter a brief description for each transaction.
Warning: When you use either accounts receivable or accounts payable, you also need to choose a customer/vendor in the name column. If you do not, the computer will not accept your entry.
We will do the first JE together. Press the “Save and New” button when you are done with the first entry. This will take you to another screen so that you can complete the next journal entry. EACH JOURNAL ENTRY SHOULD BE COMPLETED ON A SEPARATE SCREEN! Complete all subsequent regular journal entries from Oct 1 to Oct 31. (Don’t do the adjustments yet!)
Printing out a Journal
If you wish to view a copy of the journal, you can print one out now. To do this, go to Reports à Accountant & Taxes à Journal. DON’T FORGET TO CHANGE THE DATES from Oct 1, 2013 to Oct 31, 2013. Click down below on the journal to review the contents. Click the Print button. When the print screen comes up, choose the option (in the bottom left hand corner) that says “fit report to one page wide.” (Click the mouse button to choose the box.) Make sure you choose the appropriate printer for your classroom.
Review the journal for accuracy. Make any necessary changes.
Printing out a Trial Balance
Print out a trial balance. DON’T FORGET TO CHANGE THE DATES. Go to Reports àAccountants & Taxes à Trial Balance. The trial balance will be helpful to you when preparing your adjusting journal entries. (See a completed trial balance with the correct balances in Attachment A. It is important that you correct any errors before proceeding on. THIS IS THE TRIAL BALANCE BEFORE ADJUSTING ENTRIES ARE MADE. IF there are errors on it, there will be errors on adjustments and financial statements, so TAKE THE TIME TO COMPARE EACH LINE TO THE ATTACHMENT. Find your errors, if any, and make corrections.)
Prepare the Worksheet Using Excel.
You can minimize the QuickBooks Screen and go into the Excel Program. (Don't close out QuickBooks; just minimize it.) Open the Excel file that you downloaded on to your flash drive from the Internet. PUT YOUR NAME ON THE WORKSHEET. Use the information from requirement 7 of your text on page 454 to complete the worksheet that I have set up for you. You can use the Excel program, just as we have done for Chapter 5 and 12 to simplify this task. Don't forget to save your worksheet. (After you have completed the worksheet, make sure you get the check figures for net income. Save your work to your flash drive and print out the worksheet.)
Prepare Adjusting Entries
After completing and balancing out the worksheet, you are ready to enter the Adjustments into QuickBooks. Don't forget that the ONLY way to get data into the accounting system is through the General Journal process. Get back into the QuickBooks Program by restoring the Window. Enter your adjustments the same way you entered the other transactions. (Company: Make Journal Entries -- continue on with the JE's. Remember that you are making the JE's at the end of the month of October, so just continue them where you left off.) You may want to use the notation AJE in the memo box.
Print an updated Journal that will include the newly entered AJE's (Reports à Accountants & Taxes à Journal; CHANGE THE DATES October 1 - 31, 2013, then print.) Also print out a trial balance which will include the adjustments. (This is called the adjusted trial balance.)
Printing out a General Ledger
Print out a general ledger. Choose Reports à Accountants & Taxes àGeneral Ledger, CHANGE THE DATES, and Print. This will show you all the detail making up the account balances. (Notice that you did not have to post anything. The computer did it all for you!!!!)
Printing out Financial Statements
Print out the Financial statements. Go to: Reports à Company & Financial à Profit and Loss Standard (The Income Statement). Do the same to print out the Balance Sheet. Choose “Balance Sheet Standard.” REMEMBER TO CHANGE THE DATES! Use the first standard choice available on the menu. Check it against the check figures given out in class or posted on the web site. (No Statement of Owner’s Equity is set up. None is required for you this time.) YOU MUST PRINT OUT THE FINANCIAL STATEMENTS PRIOR TO CLOSING THE ACCOUNTS.
Preparation of Closing Entries -
This is required if you wish to receive a few extra credit points.
Normally the closing process is not done in QuickBooks. However, since the purpose of this problem is to practice what we learned in class, you will prepare closing entries for a few extra points. Complete the journal entries exactly as you did before. (Select Company à Make General Journal Entries.) Based on the balances in the most recent trial balance which you should have in front of you, prepare closing entries in QuickBooks to perform the following:
· Close The income statement accounts with credit balances
· Close the income statement accounts with debit balances
You may want to check the balance in the income summary account before proceeding to the next entry. (Hint: the balance should be equal to your net income figure. To check it, look at either a trial balance or the general ledger)
· Close Income summary – Check out a general ledger account for this. Don’t forget that now beginning and ending inventory balances exist in this account.
· Close Drawing
Printing out finalized reports:
Once you are finished, you need to print out a final general journal , a final general ledger, and a (post closing) trial balance. All of these reports should include the closing entries, if you chose to complete them. (The post closing trial balance will show all revenue, expense, income summary, and dividend accounts at a zero balance.
Close out the Program:
Go to File menu, then choose Close Company. You then need to exit the program. Go to File menu, then choose exit. BE PATIENT!!! The computer is saving the data to your disk. DO NOT PULL OUT your flash drive UNTIL THE GREEN LIGHT ON THE DRIVE GOES OUT AND YOU ARE COMPLETELY OUT OF QUICKBOOKS.
DO NOT TURN IN EVERYTHING! Turn in the following reports in the following order:
1) Profit and Loss (Income Statement)
2) Balance Sheet
3) Worksheet completed in Excel
4) Journal with all transactions, including the closing entries (if you did them)
5) General Ledger (after all transactions are recorded, including the closing entries, if you did them.)
6) Post Closing Trial Balance (after closing – the only accounts that should show up are Assets, Liabilities, and Capital.) If you did not complete the closing entries, then turn in the final adjusted trial balance (pre-closing) that you do have.