Ust Case
UST Company UST Company is a retail company located in Hong Kong. This case contains information about the company’s accounting records and activities for 2016. The owner of the company has asked you to use this information to generate the company’s 2016 financial statements according to the International Financial Reporting Standards (“IFRS”). Requirements: A. Create an accounting equation worksheet for UST Company. This worksheet should include all the accounts listed in the company’s chart of accounts below. This accounting equation worksheet will serve as the general ledger for UST Company.
UST Company Chart of Accounts Asset accounts Cash Accounts receivable Merchandise inventory Prepaid expenses Land Fixed assets Accumulated depreciation Liability accounts Accounts payable Customer prepayments Other current liabilities Long-term liabilities Temporary accounts Dividends Sales Cost of goods sold Selling and administrative expenses Rent expense Insurance expense Depreciation expense Interest expense Gains Losses Shareholder equity accounts Contributed capital Retained earnings
NB: You can also use two additional accounts if you want: “Dividends Payable” and “Current Portion of Long Term Debt” B. Based on the 2015 financial information presented later in the case, enter into the appropriate column on the worksheet, the January 1, 2016 balance for each account. C. Complete the following activities. 1. Prepare original journal entries for each 2016 transaction presented later in the case. 2. Post each original entry to the general ledger. 3. Prepare an unadjusted trial balance (i.e., total each column and verify that the accounting equation balances). D. Complete the following activities.
1 Copyright Gilles HILARY
1. Prepare the adjusting journal entries that are necessary as of December 31, 2016 for the following items: • Rent; • Interest; • Insurance; • Depreciation; and • Loan principal. 2. Post each adjusting entry to the general ledger. 3. Prepare an
UST Company Chart of Accounts Asset accounts Cash Accounts receivable Merchandise inventory Prepaid expenses Land Fixed assets Accumulated depreciation Liability accounts Accounts payable Customer prepayments Other current liabilities Long-term liabilities Temporary accounts Dividends Sales Cost of goods sold Selling and administrative expenses Rent expense Insurance expense Depreciation expense Interest expense Gains Losses Shareholder equity accounts Contributed capital Retained earnings
NB: You can also use two additional accounts if you want: “Dividends Payable” and “Current Portion of Long Term Debt” B. Based on the 2015 financial information presented later in the case, enter into the appropriate column on the worksheet, the January 1, 2016 balance for each account. C. Complete the following activities. 1. Prepare original journal entries for each 2016 transaction presented later in the case. 2. Post each original entry to the general ledger. 3. Prepare an unadjusted trial balance (i.e., total each column and verify that the accounting equation balances). D. Complete the following activities.
1 Copyright Gilles HILARY
1. Prepare the adjusting journal entries that are necessary as of December 31, 2016 for the following items: • Rent; • Interest; • Insurance; • Depreciation; and • Loan principal. 2. Post each adjusting entry to the general ledger. 3. Prepare an