Part ISet up a new company in QuickBooks using the following information. (Reminder: Save your company file to the location specified by your instructor. Use the filename: [your name] Comp Exam 1) On January 1, 2021, you establish a law firm. You’ve been offered two contracts on retainer for two local businesses. With the two contracts and walk-in clients, you think you can make your law practice a success. At the current time, you do not plan to hire any employees. Instead, you plan to perform the services yourself, at least initially until cash flow from the business can fund employee payroll.
Company Name [your name] Comp Exam 1 Federal Tax ID 123-45-6789 Address 12 Elm Street City Woodbury State NJ Zip 08096 Phone 856-222-3333 Industry Legal Services Income Tax Form Sole Proprietor (FORM 1040) Fiscal year starts January 1, 2021 Checking Account [your name] Comp Exam 1 Checking
Then, after you have set up your company, you need to add three sets of information. First, you need to add the people you do business with. You will add the following 2 customers and 3 vendors using the following information.
Customer Name/ Company Name Airline Transport Address 40 George Blvd
Cherry Hill, NJ 08033 Contact Mary Telephone 609-833-2904 Terms Net 30
Customer Name/ Company Name CAD Express Address 1234 Middle Ct
Haddonfield, NJ 08033 Contact Lori Telephone 856-556-7766 Terms Net 30
Vendor Name/ Company Name AA Equipment Leasing Address 72 Long Lane
Vineland, NJ 08445 Telephone 609-555-1234 Terms Net 30
Vendor Name/ Company Name Able Office Supplies Address 900 Truman Blvd
Marmora, NJ 08229 Telephone 609-376-1356 Terms Net 30
Vendor Name/ Company Name Bay Advertising Agency Address 55 Inlet Street
Ocean City, NJ 08226 Telephone 609-376-5555 Terms Net 30
Then, you will add this information to the Services you sell.
Legal Consultation (hourly) $120 per hourAccount: 45400 Monthly Retainer $1000 per monthAccount: 45400
Then, you will add banking information as follows: You’ll need to add a Business Checking Account (current asset account, #10100). Use the numbers “123456789” as both bank account numbers and routing numbers. Your account will be named “[your name] Comp Exam 1 Checking”, dated 1/1/2021, with a $0 balance.
Part IIRecord the following transactions in QuickBooks for the new company. (NOTE: For any transactions involving customer payments, select “Deposit” on QuickBooks to deposit the customer payment directly to the Checking account.)
DateTransaction 01/01/2021You invested $1,500 cash in the business (Check No. 1000). 01/01/2021Leased office furniture for the business. Received the bill and paid one month’s rental ($110 check) to AA Equipment Leasing. 01/01/2021Billed monthly retainer fees to both clients: Airline Transport and CAD Express. 01/02/2021Purchased $150 of office supplies on account from Able Office Supplies. 01/10/2021Paid $540 from your business checking account to United States Post Office (USPO) postage expense for mailing brochures to potential clients. 01/12/2021Provided 2 hours of legal consultation to walk-in client. She paid cash at end of meeting today. The customer payment received was deposited directly into the Checking account. 01/15/2021Received bill from Bay Advertising Agency for $200 of advertising expenses. 01/16/2021Received payment from Airline Transport for monthly retainer fee as billed on 01/01/2021. Deposited check # 444 into your business checking account. 01/20/2021Received payment from CAD Express for monthly retainer fee as billed on 01/01/2021. Deposited check #888 into business checking account. 01/25/2021Paid $150 for the office supplies purchased from Able Office Supplies on 01/02/2021. 01/28/2021Provided one hour of legal consultation today to walk-in client. Client paid cash. The customer payment received was deposited directly into the Checking account.
Part IIIGenerate the following reports using QuickBooks. Convert them to Excel. a. Journal from January 1, 2021 to January 31, 2021.b. Trial Balance at January 31, 2021.c. Profit and Loss, standard, from January 1, 2021 to January 31, 2021.d. Balance Sheet, standard, at January 31, 2021.e. Statement of Cash Flows for January 2021.f. Customer Balance Detailg. Vendor Balance Detail