ACCT 101 - Schmidt

Comprehensive Problem 1 – Using QuickBooks

(9th Edition)

 

NOTE:  Make sure your flash drive/thumb drive is in the proper port prior to logging on to the computer system. We will be using a special log in to complete this problem in the labs.  If you use your regular student log in, you will receive error messages when accessing Quickbooks. Therefore, sign in with the following information:

 

User Name:       quickbooks

Password:          quickbooks

Domain:             pcXXXX (this computer) 

 

(Make sure you change the domain. It should NOT say Cerritos.)

 

Why are we doing this?

The purpose of this assignment is two-fold.  The completion of Comprehensive Problem 1 on pages 207 - 208 of your text will assist you in the review of the materials covered in Chapters 1 – 4.  Secondly, it will introduce you to the basics of a very popular software accounting package called QuickBooks. 

 

What you need to Start!

Textbook and Materials:

You should have your text opened to the problem.  You should have a pen or pencil.  Most importantly, you should have a thumb drive or other type of media  with your name on it.

 

Downloading Instructions:

You will need to download the file from my website:

 

Go to my website at www.cerritos.edu/dschmidt.  Then click on the Course Materials link, then choose ACCT 101.  Find the Comprehensive Problem link under the Chapter 4 materials, and then RIGHT CLICK on the “Quick Book files.”  You may then choose the “save target as” and download the files to your Flash drive.   After you have downloaded the file, exit the internet.  (If you don’t, your computer will run a lot slower.)

 

I have gone through all the set up procedures that are required in the QuickBooks program.  (If you notice a few journal entries that have already been input, that’s because we needed to set up your beginning balances.  I have also set up your chart of accounts for you.  (See attachment A for list of accounts.) You will need to customize the company, prepare journal entries, and print out the necessary reports.  The directions for these procedures are shown below:

 

Getting Started:

Make sure the thumb drive with your files on it (that you downloaded from my website) is in the port.

  

Accessing Quick Books:

From the Desktop, Choose Start à Programs à QuickBooks à  QuickBooks Pro 2007.  Be Patient!!! It takes awhile for the program to load.  (If you get a message about a new software update, choose No to ignore it.)

 

Open the Company File:

You should see “Kelly Consulting, P.C.” in the blue title bar of your program.  If you don’t see this, then choose the Open a company file dialog box, use the drop down box to find the location of your flash drive and the open the previously downloaded file called “Kelly Consulting, P.C.” on your Flash drive.   (BE CERTAIN YOU CHANGE THE SOURCE TO BE THE PORT where your FLASH DRIVE is located!!!)

 

Customizing your Company:

You now need to customize your company.  From the main menu choices, go to the Company menu, choose Company Information.  In the box that says Company Name, you need to enter your last name in front of the Kelly Consulting, P.C. title.  (For example, my Company Name would read Schmidt’s Kelly Consulting, P.C. after I make the change.  Your revised company name will have your last name in front of it. 

 

The Accounting Cycle Review Problem:

 

Record Journal Entries

Now you are ready to record Journal Entries for the transaction.  Go to the Company Menu, then choose Make General Journal Entries. MAKE SURE YOU CHANGE THE DATE from today’s date to the date used in your problem.   Be consistent with the year – Use 2008 as the year for the whole problem on all of the journal entries.  Use the drop down menus to pull up the correct account names.   Use the mouse or the tab keys to enter the proper amounts and to enter a brief description.  See attachment B for a printout of how your first journal entry should look. Press the Save & New button when you are done with the first entry.  (The first time you use a fixed asset account – like office equipment – the program may ask  you about tracking Fixed Assets on Journal Entries.  Click on the do not display message box.)  Complete all subsequent regular journal entries from May 3 through May 31.  (Don’t do the adjustments yet!) 

 

Note:  Any time you use Accounts Receivable or Accounts Payable, you must select a Customer/Vendor in the “Name” column of the Journal Entry screen. I have set these up for you.  Simply use the drop down box to select the most appropriate choice for your transaction. If a customer or vendor is not listed, use the “Miscellaneous one” set up for you.

 

IMPORTANT JOURNAL ENTRY NOTE:  The total amount given for the transaction on May 16 includes $120 accrued in the prior period.  This transaction will involve three accounts:  Salary Expense, Salaries Payable and the Cash accounts.

 

 

Printing out a Journal

After entering the journal entries, you should view a copy of the journal. Print one out now.  To do this, go to Reports à Accountant and Taxes à Journal.  DON’T FORGET TO CHANGE THE DATES at the top so you get a complete printout of your entries.  Click down below on the journal to review the contents after you change the dates. Click the Print button.  (The first time you print a report, please make sure the little box on the bottom left hand side of the print screen that says “Fit report to one page wide” is checked.)

 

Review it for accuracy.  Make any changes necessary.  Reprint if necessary.

 

Printing out a Trial Balance

Print out a trial balance.  Go to Reports à Accountants and Taxes à Trial Balance.   DON’T FORGET TO CHANGE THE DATES.  The trial balance will be helpful to you when preparing your adjusting journal entries.  Check your answers against the check figures given to you in class or on website.

 

Prepare Adjusting Entries

Enter your adjustments the same way you entered the other transactions.  (Company Menu à Make Journal Entry….  Use the end of the month date.) You may want to use the notation AJE in the memo box.

 

Print out an Updated Journal and Adjusted Trial Balance

You should print an updated Journal to review your adjustments.  (Reports à Accountant and Taxes à Journal,  CHANGE THE DATES, then print.)  Then print out an Adjusted Trial Balance which incorporates the adjustment amounts. (Same directions as Trial Balance above.)  See Attachment C for selected answers for the Adjusted Trial Balance.

 

Printing out a General Ledger.

Print out a general ledger.  Choose Reports, Accountant and Taxes, General Ledger, CHANGE THE DATES, and Print.  This will show you all the detail making up the account balances.  You should check these figures with the check figures provided.

 

Printing out Financial Statements

Print out Financial statements.  Use the Reports Menu.  Then choose the Company and Financial Option.  Print out the “Profit and Loss Standard” and the “Balance Sheet  Standard.”  REMEMBER TO CHANGE THE DATES!  Check figures are shown in attachment C.  FINANCIAL STATEMENTS MUST BE PRINTED PRIOR TO CLOSING….  Don’t forget that closing entries wipe out nominal accounts.

 

Printing out a pre-closing Trial Balance

Print out a pre-closing Trial Balance.  (This is the adjusted trial balance after all the adjustments have been made but prior to closing.)  This will assist you in the closing process.  This is the source of data that you should be working from when you prepare your closing entries.  (Reports à Accountant and Taxes à Trial Balance, CHANG THE DATES, and print.)

 

Preparation of Closing Entries

(Closing entries are normally not required in general ledger programs, but I am requiring you to do them to practice the four basic closing entries that you will be tested on.)

 

Based on the balances in the pre-closing trial balance, prepare closing entries to perform the following:  (Same process as other JE’s.  Use end of the month date.)

·        Close Revenues

·        Close Expenses

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

·        Close Dividends

 

Printing out finalized reports:

Once you are finished, you need to print out a final general journal, general ledger, and post-closing trial balance.  (The post closing trial balance will show all revenue, expense, income summary, and dividend accounts at a zero balance.)  Use the same directions provided above.

 

When you are finished, you need to close the company file.  Simply exit out of the program.  (All the work you have been doing has been saved each time you entered a Journal entry.) There is no need to perform any additional save functions prior to exiting the program.)

 

 

Reports Needed for Submission

 

DO NOT TURN IN EVERYTHING.  ONLY TURN IN THE REQUIRED DOCUMENTS!!

 

Turn in the following reports in the following order:

1)  Profit and Loss (Income Statement)

2)  Balance Sheet

3)  Trial Balance (pre-closing)

4)  Journal with ALL journal entries on it, including the closing journal entries

5)  General Ledger with all journal entries on it including the closing entries

 

(Please make sure that your Journal and Ledger contain all the journal entries, including the adjusting and closing entries.)