Asset Accounts

Acct #
Cash 101
Baking Supplies 102
Prepaid Rent 103
Prepaid Insurance 104
Baking Equipment 105
Office Supplies 106
Accounts Receivable 107
Accumulated Depreciation 108
Trademark 109
Leasehold Improvements 110
Accumulated Amortization 111

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.
 Liability Accounts Equity Accounts
Acct #
Notes Payable 201 Common Stock
Accounts Payable 202 Dividends
Wages Payable 203
Interest Payable 204
Loans Payable 205

Revenue Accounts

Bakery Sales
Merchandise Sales
he appropriate accounts to record to as you are analyzing and
is nothing to complete on this page; this is simply a resource
for you. Expense Accounts

Baking Cost of Goods Sold

Merchandise Cost of Goods Sold (FIFO)
Rent Expense
Insurance Expense
Misc. Expense
Business License Expense
Advertising Expense
Wages Expense
Telephone Expense
Interest Expense
Depreciation Expense
Amortization Expense
Office Supplies Expense
s
Acct #
301
302

ts
Acct #
401
402

ts
Acct #
501
502
503
504
505
506
507
508
509
510
511
512
513
 Peyton Approved
Trial Balance
2017
Unadjusted trial balance Adjusting entries Adjusted trial balance
Account Debit Credit Debit Credit Debit Credit
Cash 64,713.72 64,713.72
Baking Supplies 165,250.00 137,400.00 27,850.00
Merchandise Inventory (FIFO) 25,750.00 25,750.00
Prepaid Rent 7,500.00 7,500.00
Prepaid Insurance 2,400.00 2,000.00 400.00
Baking Equipment 17,000.00 17,000.00
Accumulated Depreciation 3,285.72 2,642.86 5,928.58
Leasehold Improvements 10,000.00 10,000.00
Accumulated Amortization 2,000.00 2,000.00 4,000.00
Trademark 2,300.00 2,300.00
Office Supplies 1,600.00 1,350.00 250.00
Accounts Receivable 30,401.00 30,401.00
Notes Payable 10,000.00 10,000.00
Interest Payable 1,468.75 1,468.75
Accounts Payable 27,325.00 27,325.00
Wages Payable 22,800.00 22,800.00
Loans Payable 21,000.00 21,000.00
Common Stock 30,000.00 30,000.00
Dividends 20,000.00 20,000.00
Bakery Sales 335,675.00 335,675.00
Merchandise Sales 35,200.00 35,200.00
Baking Cost of Goods Sold 137,400.00 137,400.00
Rent Expense 90,000.00 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 2,780.00
Office Supplies Expense 1,350.00 1,350.00
Business License Expense 375.00 375.00
Advertising Expense 5,200.00 5,200.00
Wages Expense 22,800.00 22,800.00
Telephone Expense 3,456.00 3,456.00
Merchandise COGS (FIFO) 15,760.00 15,760.00

Total 464,485.72 464,485.72 169,661.61 169,661.61 493,397.33 493,397.33

 Peyton Approved
Adjusting Journal Entries
2017

Date Accounts Debit Credit

31-Dec Depreciation Expense 2,642.86
Accumulated depreciation 2,642.86

31-Dec Amortization Expense 2,000.00

Accumulated Amortization 2,000.00

31-Dec Interest Expense 1,468.75

Interest Payable 1,468.75

31-Dec Insurance Expense 2,000.00

Prepaid Insurance 2,000.00

31-Dec Baking Cost of Goods Sold 137,400.00

Baking Supplies 137,400.00

31-Dec Office Supplies Expense 1,350.00

Office Supplies 1,350.00

31-Dec Wages Expense 22,800.00

Wages Payable 22,800.00
169,661.61 169,661.61
 Peyton Approved
Income Statement
For Year Ending 12/31/2017

Bakery Sales $ 335,675.00

Merchandise Sales $ 35,200.00
Total Revenues 370,875.00
Merchandise Cost of Goods Sold (FIFO) 15,760.00
Baking Cost of Goods Sold 137,400.00
Gross Profit 217,715.00

Operating Expenses:
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
Total Operating Expenses: 134,072.61

Net Income 83,642.39

 Peyton Approved
Closing Entries
For Year Ending 12/31/2017

Date Accounts Debit Credit

31-Dec Bakery Sales 335,675.00
Merchandise Sales 35,200.00
Income Summary 370,875.00

31-Dec Income Summary 287,232.61

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
Retained Earnings 83,642.39

31-Dec Retained Earnings 20,000.00

Dividends 20,000.00

761,750.00 761,750.00
 Peyton Approved
Statement of Retained Earnings
For Year Ending 12/31/2017

Beginning Balance: -
plus Net Income 83,642.39
less Dividends: 20,000.00
Ending Balance: 63,642.39
 Peyton Approved
Balance Sheet
As of December 31, 2017

Assets
Current Assets:
Cash 64,713.72
Baking Supplies 27,850.00
Merchandise Inventory (FIFO) 25,750.00
Prepaid Rent 7,500.00
Prepaid Insurance 400.00
Office Supplies 250.00
Accounts Receivable 30,401.00
Total Current Assets 156,864.72

Long Term/Fixed Assets:

Baking Equipment 17,000.00
Accumulated Depreciation 5,928.58
11,071.42
Leasehold Improvements 10,000.00
Accumulated Amortization 4,000.00 6,000.00

Trademark 2,300.00

Total Assets: 176,236.14

 Peyton Approved
Balance Sheet
As of December 31, 2017

Liabilities and Owners' Equity

Current Liabilities:
Accounts Payable 27,325.00
Wages Payable 22,800.00
Interest Payable 1,468.75
Total Current Liabilities 51,593.75

Long Term Liabilities:

Notes Payable 10,000.00
Loans Payable 21,000.00
Total Long Term Liabilities: 31,000.00
Total Liabilities: 82,593.75

Common Stock 30,000.00

Retained Earnings 63,642.39

Total Equity 93,642.39

Total Liabilities & Equity 176,236.14

 2017 2016 2015 Industry Standard

Quick Ratio 1.84 2.2 2.8 1.75

Gross Margin 0.59 0.55 0.7 0.7
Net Margin 0.23 0.22 0.32 0.24
Return on Equity 0.89 0.9 0.78 0.8