The Accounting Cycle of Wal-Mart (Hypothetical), Coursework Example

Steps in the Accounting Cycle

Cash                234,000

1/20                 334,000

2/20                 365,999

3/20                 348,987

4/20                 567,985

5/20                 323,098

6/20                 333,444

7/20                 387,456

8/20                 543,456

9/20                 456,987

10/20               345,987

11/20               1,897,876

Assets= Liabilities + Owners Equity/Credit Balances

Record all entries in the ledger.

Example:

General Journal

Date Account Titles and Explanation Debit Credit

2002

Jan. 20 Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,000

Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,000

Owners invest cash in the business.

21 Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,000

Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,000

Purchased land for business site.

22 Building . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,000

Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,000

Notes Payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,000

Purchased building from MTA. Paid part

cash; balance payable within 90 days.

23 Tools and Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,800

Accounts Payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,800

Purchased tools and equipment on credit from

Snap-On Tools Corp. Due in 60 days.

24 Accounts Receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,800

Tools and Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,800

Sold unused tools and equipment at cost to Ace

Towing.

26 Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600

Accounts Receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600

Collected part of account receivable from Ace

Towing.

27 Accounts Payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,800

Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,800

Made partial payment of the liability to Snap-On Tools Corp.

Journal entries of Overnight

Auto Service for January 20 through January 27

wiL96881_c03_84-133 2/27/01 12:48 PM Page 93

References

The Accounting Cycle (2009) The Accounting Cycle Retrieved November 27, 2009 from, http://www.quickmba.com/accounting/fin/cycle/