The objective of this practice set is to expose the student to a real-world simulation of maintaining a complete set of books for the accounting information system of a retail business organized as a proprietorship. The Heritage Home Furniture practice set introduces more complex transactions usually associated with larger businesses. The student will have ample opportunity to analyze and record a wide variety of business transactions generally covered in a financial accounting course. However, a major objective of this practice set is to involve the student in the end-of-the-period analytical work which requires a thorough understanding of the accrual basis of accounting and the skills of a trained accountant. The student will become familiar with:

  • Analyzing business transactions and recording them in appropriate accounting journals and records.
  • Business taxes such as employer payroll taxes and employee tax with-holdings.
  • Posting to the general ledger and accounts receivable and accounts payable subsidiary ledgers.
  • Preparing end-of-the-period adjustments, including a bank reconciliation, declining-balance depreciation, and a complete set of financial statements.
  • Closing the accounting records.

The student will find that preparation of this practice set will reinforce the concepts and procedures learned in Financial Accounting. It provides an excellent way to see how they are all brought together to generate the accounting information that ...

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