Solution Manual For Computer Accounting with QuickBooks Online A Cloud Based Approach, 2024 Release

Solution Manual For Computer Accounting with QuickBooks Online A Cloud Based Approach, 2024 Release By Carol Yacht and Matthew Lowenkron Chapter 1-12 CHAPTER 1 QUICKBOOKS ONLINE TEST-DRIVE INSTRUCTOR’S MANUAL OBJECTIVES 1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

Start the sample company, Craig’s Design and Landscaping Services.

Tour QuickBooks Online (QBO) and the user interface.

View recent transactions and reports.

Create an invoice, sales receipt, bill, and write checks.

Export the Chart of Accounts to Excel.

Export reports to Excel and save as PDF files.

Display Management reports.

Complete Check Your Progress.

Review and complete the QuickBooks Resources and Activities.

Complete Exercises 1-1, 1-2, 1-3, and Certification Q&A practice tests.

SYSTEM REQUIREMENTS To use QuickBooks Online (QBO), sign in with a web browser. The requirements for your computer’s operating system, Internet speed, and web and mobile browser vary depending on your system. For optimal QuickBooks Online performance, the following computer operating systems and internet speeds are recommended.

Recommended operating systems and internet speeds To check your computer’s operating system, link to the Windows version page or the Mac version page.

  

Windows PC: Windows 10 or 11, Intel Core i5 or comparable processor (2015 or newer) with at least 4 GB of RAM. You need Adobe Reader 11.0 or higher to print forms.

Mac: OS X “Big Sur” 11.1 or newer.

Internet connection: 3 Mbps or higher.

Minimum operating systems and internet speeds The specs above are recommended, but QuickBooks will run with the following minimum systems and internet speeds:  Windows PC: Windows 10, Intel Core i3 or a comparable processor (2013 or newer) with at least 2 GB of RAM.  Mac: OS X El Capitan 10.11 or newer.  Internet connection: 1.5 Mbps.

Supported web browsers In general, QuickBooks supports the current and two previous versions of browsers. We do not always support older versions. [Note: Internet Explorer is no longer a supported browser.]  Google Chrome: Version 78 or newer

1

  

Mozilla Firefox: Version 76 or newer. Note: To preview and print forms on Mac OS, you will also need the Firefox PDF plugin.

Microsoft Edge: version 75 or newer Safari: version 12 or newer (Mac only)

Mobile browsers iPhone / iPad  iOS 11.1 or newer.  Safari browser: Make sure Private mode is off to allow cookies  Other browsers, such as Chrome and Dolphin, may work but are not supported.

Android smartphones and tablets  Nougat 7.1.1 or newer  Chrome browser  Other browsers, such as Firefox and Opera, may work but are not supported.

Microsoft Surface: Microsoft Edge Other For exporting reports to Excel, use Microsoft Excel 97 or later. Adobe for saving PDF files. The free Adobe Acrobat Reader is available at https://get.adobe.com/reader/ QBO Tips  Start an Internet browser. Go online to https://qbo.intuit.com/redir/testdrive.  Each time your students start the sample company, Craig’s Design and Landscaping Services, security verification is required.  Each time the sample company is started, a new session begins. Data is not saved.  In Chapter 1, students complete Check Your Progress assignments and compare their results with the answers shown. In subsequent chapters, students provide Check Your Progress answers.  Before students start Exercise 1-1, the authors suggest they sign out of QBO. Then, students log into a new session of QBO before starting Exercise 1-1. Students complete Exercise 1-1’s transactions and continue with Exercise 1-2. Students should not log out until Exercises 1-1, 1-2 are completed.

QUICKBOOKS RESOURCES AND ACTIVITIES McGraw-Hill Connect® publishes the eBook twice a year for Fall and Spring semesters. For example, there is a Summer 2024 eBook Release for Fall semester, and a Winter 2025 eBook Release for Spring semester. eBook Releases include content and software updates, new Figures, Connect assignment updates, and SmartBook updates. e of the following may be assigned for auto-grading and feedback.

1. Assignable In-Chapter and End of Chapter Material.  Exercises 1-1 and 1-2.

2

Con nect : One or mor

2.

3.

4.

5.

6.

7.

 Exercise 1-3: Problem Solving.

Analysis Questions.

Quizzes.

Test Bank.

Certification Q&A questions.

Additional student resources (ASR).

SmartBook > + Add Assignment > select SmartBook 2.0 (or later) > New Assignment > select Chapter(s) > Continue > select Content. If all of Chapter 1 Content is selected, it looks like this.

a. Click > Continue > enter an Assignment name (e.g., Chapter 1). b. Enter a start date and due date > enter preferred score > Assign. c. An example of the author’s SmartBook assignments are shown for Chapters 1-5. You may want to have students’ complete SB for Chapters 1 through 12. In addition to completing Connect’s Certification Q&A practice tests, SmartBook is a good way to prepare for the third-party, fee-based, Certification test from Certiport.

3

Additional Student Resources (ASR) The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

1. Access QBO Sign Up. 2. Narrated PowerPoints include links to videos.

3. QBO Videos. a. b. c. d. e. f. g.

Get started with QuickBooks Step-by-step get started videos In the know video series Intuit QuickBooks channel How-to-Videos for QuickBooks Online Training videos Webinars and events

4. Text Updates.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES   

Intuit Educator Portal.

Instructor’s Manual for Chapters 1-12.

Instructor PowerPoints: Notes are included for each slide. (Select View > Notes Page.)

4

       

Excel Reports and PDF Reports: Reports are exported to Excel and saved as PDF files in each chapter. Refer to the Instructor’s Manual chart, Files Saved in Chapter 1.

Certification Information.

QBO Access, System Requirements, Technical Support, and Resources.

Syllabi.

Test Bank for Chapters 1-12.

Using Accountant Version and Certification for Professors.

Instructor preview for Connect assignments—Multiple-choice and True False quizzes, Analysis Questions, Check Your Progress, Chapter work and End-of-Chapter Exercises, Problem Solving, Certification Q&A quiz. Connect assignments are auto-graded.

Additional Student Resources: Access QBO Sign Up, Certification Info, Narrated PowerPoints, Intuit Support, QBO Videos, and Text Updates. The PowerPoints include links to videos.

To access the Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWERS ANALYSIS QUESTIONS The Analysis questions and answers are shown below, and are included within Connect’s Instructor login. Within Connect, students’ responses are auto-graded.

1. Define the chart of accounts and its categories. How do accounting textbooks define the chart of accounts?

ANSWER: The Chart of Accounts is a complete list of a business’s accounts and their balances. QBO includes the Account name, Type (for financial statement classification), the Detail Type (account subcategory), and Balance.

The chart of accounts includes two categories of accounts: 

Balance Sheet accounts: In QBO, these types of accounts reflect what you own and what you owe, like Bank, Credit Card, Assets, Liabilities, Accounts Receivable, Accounts Payable and Equity.



Income and expense accounts: These are categories for tracking how money flows in and out of your company.

In accounting textbooks, the term Chart of Accounts is defined as a list of all the accounts used in the General Ledger. Accounts are used to classify transaction information for reporting purposes.

5

2. What do you select to add account numbers to the Chart of Accounts?

ANSWER: Adding account numbers is a two-step process.

a. Go to > Account and settings > Advanced > in the Chart of accounts area, click on the pencil icon to Enable account numbers and Show account numbers > Save > Done.

b. After saving, then selecting <Done> on the Advanced Settings screen, click > Chart of Accounts > Batch edit > type the account number in the Number field > Save.

3. What numbering system is used for the Chart of Accounts? Complete the following chart.

Numbers 1000s 2000s 3000s 4000s 5000s 6000s

Type Assets Liabilities Equity Income Cost of Sales Expenses

ANSWERS MULTIPLE-CHOICE AND TRUE FALSE QUESTIONS The multiple-choice and true false quizzes are within Connect. The answers are shown below and within Connect’s Instructor login. Within Connect, students’ responses are auto-graded.

1. The following Internet browsers can be used with QB Online: a. Microsoft Edge. b. Firefox.

6

c. Google Chrome. d. Safari. e. All of these.

2. To start QuickBooks Online, you need to: a. Insert a software DVD into the drive. b. Go to your hard drive to install software. c. Insert a USB flash drive. d. Start your Internet browser. e. None of these.

3. When you start the test-drive, you need to: a. b. c. d. e.

Complete security verification.

Select the back button.

Select Start to access the software.

Install the desktop software.

All of these.

4. The central place for getting an overview of the company is called the: a. b. c. d. e.

Taskbar.

Tabs.

Dashboards.

Vendors screen.

All of these.

5. From the + New icon, you can: a. b. c. d. e.

Create an invoice.

Create a sales receipt.

Enter a bill.

Write a check.

All of these.

6. Use this icon to search transactions. a. Gear. b. Magnifying-glass. c. Question mark. d. Plus sign. e. None of these.

7. To navigate the user interface, select: a. b. c. d.

Sales.

Expenses.

Payroll.

Reports.

7

e. All of these.

8. A list of all the accounts used in the General Ledger is called a: a. b. c. d. e.

Balance Sheet.

Journal.

Chart of Accounts.

Trial Balance.

Profit and Loss Statement.

9. QBO’s Dashboards display one or more of the following: a. b. c. d. e.

Bar and pie charts.

Line graphs.

Data metrics and visualization.

Current bank accounts.

All of these.

10. In which of the following areas, is the Chart of Accounts located? a. b. c. d. e.

Gear list.

Customers.

Vendors.

Banking.

Apps.

True or False: The True or False questions are within Connect.

11. The QuickBooks Online (QBO) sample company is Bellflower Landscaping.

False. Craig’s Design and Landscaping Services.

12. QBO can be used on Windows and Mac operating systems.

True.

13. Since QBO is web-delivered, you need an Internet connection.

True.

14. Each time you log into the sample company, a new session starts.

True 15. A chart of accounts is a list of all the accounts used by a company showing identifying numbers assigned to each account.

8

True.

16. The user interface is the link between a user and the software.

True.

17. When the Management report Company Overview is selected, the general ledger is shown.

False. Profit and Loss and Balance Sheet are displayed.

18. When the Management report Sales Performance is selected, the A/R Aging Detail is displayed.

True 19. One way to add an invoice is to click on the gear icon.

False. Click on the + New icon.

20. The Journal report shows every transaction during a period of time and includes debits and credits.

True Exercise 1-1 Students complete 12 transactions. They should continue with Exercises 1-2. 1-3, and 1-4 before signing out.

Exercise 1-2 In Exercise 1-2, students export the Journal, Transaction Detail by Account, and Trial Balance to Excel.

Journal Report: The Excel report shows the 12 transactions recorded in Exercise 1-1. Go to Instructor Resources > Excel Reports. The Journal shows the date that students entered the transactions. The default date is This Month-to-date.

Transaction Detail by Account: The Excel report lists transactions subtotaled by each account on the chart of accounts. It is like the General Ledger without opening balances.

Trial Balance: The Excel report shows the Trial Balance after students record the 12 transactions in Exercise 1-1. The Instructor Resources include the Excel Reports saved. Display the trial balance for the dates students used for the Exercise 1-1 transactions.

9

Exercise 1-2 includes the following Check Your Figures amounts: Check Figures: Checking Accounts Receivable Accounts Payable Design Income Advertising

1,439.58 6,965.72 2,895.61 3,225.00 324.86

These account balances are based on starting the sample company with Exercise 1-1.

Depending on when you signed into the test-drive, your balances may differ. All Dates was selected for the Trial Balance.

Exercise 1-3: Problem Solving Exercise 1-3 Problem Solving is available within Connect. Student responses are auto-graded within Connect.

1. Display Craig’s Design and Landscaping Services Chart of Accounts.

Display the test drive’s chart of accounts: https://qbo.intuit.com/redir/testdrive > Gear > Chart of Accounts.

2. How do the View register accounts differ from the Run report accounts? Include information about financial statements in your answer.

The View register accounts show their Chart of Accounts balances. The View register accounts are also called permanent accounts and appear on the Balance Sheet. The Run report accounts do not show balances and are called temporary accounts. Temporary accounts appear on QBO’s Profit & Loss (also called the Income Statement). The Run report accounts are closed at the end of the year.

3. When through, sign out.

Certification Q&A Practice Text Certification Q&A multiple-choice questions are available within Connect. For this chapter, the certification practice test is mapped to these exam objectives: QuickBooks Online Administration, Sales and Money In, Vendors and Money Out, Basic Reports and Views. Refer to QBO Certified User_Exam Objectives.pdf.

FILES SAVED IN CHAPTER 1

10

In Chapter 1, these files are exported to Excel and saved as PDFs. Instructors may want students to add their names to file names shown below.

Chapter/Exercise Excel and PDF Page No. 1 Chapter 1_CofA_sample company_Student Name.xlsx 15 Chapter 1_CofA_sample company_Student Name.pdf 15 1-2 Exercise 1-2_Journal.xlsx 36 Exercise 1-2_Journal.pdf 36 Exercise 1-2_Transaction Detail by Account.xlsx 36 Exercise 1-2_Transaction Detail by Accont.pdf 36 Exercise 1-2_Trial Balance.xlsx 36 Exercise 1-2_Trial Balance.pdf 36 Instructor Resources includes PDF Reports and Excel Reports. The file names are the same as what is shown in the textbook, and are listed in alphabetic order. Scroll down the screen to see both Chapter reports and Exercise reports.

Scroll down for exercises.

For acces s to the Instructor Resources, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

11

CHAPTER 2 NEW COMPANY SET UP AND CHART OF ACCOUNTS INSTRUCTOR’S MANUAL

OBJECTIVES

11. Set up the QuickBooks company, Student Name Sales and Service (use your first and last name).

12. Complete account and settings.

13. Check QuickBooks Online subscription.

14. Import the Chart of Accounts, edit default accounts, and add new accounts.

15. Save the Chart of Accounts as Excel and PDF files.

16. Use QuickBooks Online on a different computer.

17. Learn about user roles and access rights.

18. View the Audit Log. 19. Complete the QuickBooks Resources and Activities.

20. Complete Check Your Progress, Connect assignments, and Exercises 2-1, 2-2, 2-3, and Certification Q&A practice test.

QBO Tips  Instructors use the Intuit Educator Portal to invite students to QuickBooks Online Plus.

QBO+ includes a one-year subscription.  For information about the Educator Portal, sign into Instructor Resources > Intuit Educator Portal.  Using the non-expiring QBO Accountant version, professors can hyperlink to student work.

Hyperlink from Intuit’s Educator Portal. Sign into the Portal using your QBO Accountant credentials.  QBOA includes free certification for professors – link to Pro Advisor training materials from the Portal’s home page.  For the Instructor login for Connect, contact your McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.  Students should write down their User ID and Password. Each time QBO is started, the User ID and Password is needed. A code can also be sent to a cell phone.  If your students want to access their Student Name Sales and Service account on a different computer, device, or location, refer to Use QuickBooks Online on a Different Computer.  To import the chart of accounts, students use the Chapter 2_Chart of Accounts.csv file. It is located within Additional Student Resources > Import.  Use these steps to see the most recent Get Started questions.

12

1. Before emailing a QBO invitation, clear your browser’s Cache and Cookies (open Troubleshooting pdf). Intuit recommends Chrome.

2. To see the most recent Get Started questions: Create a new email address > start the Portal > select Classes > + Add Class > Add student > send an invitation to your new email address > Sign out of Portal > restart your computer.

3. Go to new email address > accept invitation > start company.

The screens that are shown in the textbook may differ from what students see. QBO updates are automatic. Regularly go online to Additional Student Resources > Text Updates.

NOTE TO PROFESSOR: In Chapter 2, students set up a products and service business called Student Name Sales and Service. Students complete hands-on practice with this company in Chapters 2 through 12. Work is illustrated within the chapter, then continued in the end-ofchapter exercises. Case Problem 1 (Your Name Accounting, a service business), and CP 2 (Tacoma Computer Club, a nonprofit organization) include additional companies. Using the Educator Portal, professors can invite their students to up to four companies for cloud accounting practice.

PROFESSORS: INTUIT’S EDUCATOR PORTAL

The Educator Portal works with the professor’s QuickBooks Online Accountant (QBOA) version. QBOA is free and does not expire. Educators and staff at accredited academic institutions in the United States are eligible. Professors can sign up for QBO Accountant from the website shown below, or from the Portal’s website.

To obtain a copy of QuickBooks Online Accountant, link to register for QuickBooks Online Accountant.

13

QuickBooks Online for Educators Sign into the Educator Portal at https://education-portal.app.intuit.com/app/dashboard with QBOA’s email and Password, or text a code. Watch the video on the Portal’s Home page.

From the Portal, professors can:

     

Add their class.

Upload student list using an Excel or CSV file.

Email a QuickBooks invitation to students.

Add up to four blank companies for students.

Hyperlink to each student’s work.

Set up demo companies for class preparation and practice.

For detailed Intuit Educator Portal information, log into Instructor Resources > Intuit’s Educator Portal.

Computer Accounting with QuickBooks Online: A Cloud-Based Approach, Winter 2024 Release, includes four companies for hands-on practice with QBO+.

1.

2.

3.

4.

Chapter 1: Test-drive. The sample company includes populated data.

Chapters 2-12: Student Name Sales and Service.

Case Problem 1: Your Name Accounting Case Problem 2: Tacoma Computer Club

14

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

Connect eBook Releases McGraw-Hill Connect® publishes the eBook twice a year for Fall and Spring semesters. For example, there is a Summer 2024 eBook Release for Fall semester, and a Winter 2025 eBook Release for Spring semester.

1. Assignable In-Chapter and End of Chapter Material:  Check Your Progress.  Exercises 2-1 and 2-2.  Exercise 2-3: Problem Solving.

2. Analysis Questions.

3. Quizzes.

4. Test Bank.

5. Certification Q&A. 6. Connect’s SmartBook > + Add Assignment > select SmartBook 2.0 (or later) > New Sign into Connect > + Add Assignment > Question Bank > Select Chapter

15

Assignment > select Chapter(s) > Continue > select Content. If all of Chapter 2 Content is selected, it looks like this.

d. Click Continue > enter an Assignment name (e.g., Chapter 2). e. Enter start date and due date (not the same as previous chapter) > enter preferred score > Assign. f. An example of the author’s SmartBook assignments are shown for Chapters 1-5. You may want to have students’ complete SB for Chapters 1 through 12. In addition to completing Connect’s Certification Q&A practice tests, SmartBook is a good way to prepare for the third-party, fee-based, Certification test from Certiport.

16

7. Additional Student Resources.

The following resources can be found on the ASR page in Connect’s ebook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

1. Access QBO Sign Up. 2. Narrated PowerPoints include links to QBO videos.

3. QBO Videos. As of this writing, these videos are included.

1) Configuring company settings 2) Chart of Accounts explained 3) Add accounts to your charts 4) Use the Audit Log in QuickBooks Online 5) How to add and manage users 6) Video center 7) Learn about QBO with how-to-videos 8) Intuit QuickBooks channel 9) In the know video series 17

10) Training videos 11) Webinars and events 4. Text Updates 1) Yacht Text Updates: eBook content and software updates, new Figures, Connect assignment updates, and SmartBook updates.

2) Exercise 2-2 Chart of Accounts.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

         

Instructor’s Manual for Chapters 1-12.

Instructor PowerPoints: Notes are included for each slide. (Select View > Notes Page.)

Excel Reports and PDF Reports: Excel and PDF files are saved in each chapter. Refer to the Files Saved in Chapter 2 chart on IM page 22.

Certification Information Intuit Educator Portal: step-by-step instructions for using the Portal System Requirements, Technical Support, and Resources Syllabi Test Bank for Chapters 1-12 Instructor preview for Connect assignments—Multiple-choice and True False quizzes, Analysis Questions, Check Your Progress, Chapter work and End-of-Chapter Exercises, Problem Solving, Certification Q&A quiz. Connect assignments are auto-graded.

Additional Student Resources: Access QBO Sign Up, Certification Info, Import, Intuit Support, FAQs, Narrated PowerPoint, QBO Videos, System Requirements, Text Updates, and Troubleshooting. The PowerPoints include links to videos. Text Updates. Text Updates includes links to Yacht Text Updates (eBook updates), Text Update Archive File (print 4 th edition), Chart of Accounts video, and the Exercise 2-2 Chart of Accounts.pdf file. Students should verify their Chart of Accounts (Account List) with Exercise 2-2 Chart of Accounts.pdf file.

To access the Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

18

QUICKBOOKS ONLINE UPDATES QuickBooks Online software is dynamic, meaning updates are a regular feature. This is like other online updates; for example, banking apps, smartphone apps, and operating system updates. Many of the changes are more cosmetic than functional, but there are differences.

Updates may change textbook screen illustrations. Intuit tests QBO changes on specific companies or users. New features may not be rolled out at the same time.

The authors suggest selecting from within QBO to help resolve differences, regularly check Text Updates, and product updates at https://www.firmofthefuture.com/.

ANSWER TO ANALYSIS QUESTION

The Analysis Question and answer is shown below, and are included within Connect’s Instructor login. In Connect, students’ responses are auto-graded.

What is cloudware?

ANSWER:

Cloudware refers to software that is built, installed, delivered and accessed entirely from a remote Web server, also called the “cloud.” Cloudware is a software delivery method that provides software over the Internet.

MULTIPLE-CHOICE QUESTIONS

The multiple-choice and true false quizzes are within Connect. The answers are shown below and within Connect’s Instructor login. In Connect, students’ responses are auto-graded.

1. This term refers to software that is internet delivered.

A. B. C. D. E.

Desktop.

Dashboards.

Account and settings.

Cloudware.

All of these.

19

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

2. Another name for the Chart of Accounts is: A. B. C. D. E.

Account and settings.

Account list.

Balance sheet.

Profit and loss.

None of these.

3. From the Home screen, you can:

A. B. C. D. E.

See the dashboards.

View Profit and loss.

See Expenses.

See Bank accounts.

All of these.

4. The Navigation bar includes these selections:

A. B. C. D. E.

Dashboards.

Sales.

Reports.

Transactions.

All of these.

5. To create a transaction, select the:

A. B. C. D. E.

Search icon.

Question mark. + New icon.

Minus sign.

All of these.

6. To configure QBO to work the way you want, go to:

A. Export files to Excel.

20 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

B. C. D. E.

Print as Adobe PDF file.

Set up a chart of accounts.

Account and settings.

None of these.

7. The column on the chart of accounts that classifies accounts for financial statements is:

A. B. C. D. E.

Account number.

Type.

Account name.

Description All of these.

8. QBO exports reports to this file type:

A. B. C. D. E.

Excel.

Transaction list.

Accounts.

Customers.

All of these.

9. Search includes: A. B. C. D. E.

Help menu.

Creating transactions.

Activities.

Dashboards.

Recent transactions.

10. The gear icon includes:

a. Account and Settings. b. Chart of Accounts. c. Import data. d. Profile. e. All of these.

True or False: The True or False questions are within Connect.

21 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

11. The name of the company set up in Chapter 2 is your first and last name Sales and Service.

True

12. Cloudware refers to software accessed entirely from a Web server.

True 13. A password can be set up with 4 characters or less.

False. A password can be set up with 8 characters or more.

14. Each time you start QBO, you must type a Password. User IDs can be saved by your browser.

True

15. To see the work you have completed, display the Audit Log. True.

16. The Navigation bar is on the left side of the QBO window.

True

17. To resolve differences between textbook screen images due to QBO updates, use the Help selection.

True.

18. To explore the power of QuickBooks, read the PDF file.

False (To explore the power of QuickBooks, watch the videos included in Chapter 2.)

22 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

19. When the + New icon is selected, you can create transactions, invoices, sales receipts, bills, and more.

True

20. Preferences, also called settings, can be completed as you work.

True

ANSWERS TO CHECK YOUR PROGRESS Within Chapter 2, students complete Check Your Progress. Also, included within Connect.

1. The Account No. for Checking is 101.

2. The Account Type for Checking is Bank.

3. The Account No. for Accounts Payable is 201.

4. The Account Type for Accounts Payable is Accounts Payable (A/P).

5. The Account Number for Common Stock is 301.

6. The Account Type for Common Stock is Equity.

EXERCISE 2-1

Students add new accounts, and edit Chart of Accounts default accounts.

23 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

EXERCISE 2-2

Students save the Chart of Accounts as an Adobe PDF file and export it to Excel. The suggested files names are Exercise 2-2_Chart of Accounts.pdf and Exercise 2-2_Chart of Accounts.xlsx.

EXERCISE 2-3, PROBLEM SOLVING

Exercise 2-3 Problem Solving is available within Connect. In Connect, student responses are auto-graded.

On the Chart of Accounts, why are the account and detail type selections important? To explain the account and detail types, use 3 accounts – one asset, one liability and one expense account. Identify Account Type, Detail Type, Name, Number and financial statement.

The Account Type and Detail Type columns are important because they classify accounts for the financial statements. Student choices for accounts may vary.

Asset example:

Account Type Bank

Detail Type Checking

Name Checking

Number 101

Financial Statement Balance Sheet

Number 201

Financial Statement Balance Sheet

Liability account:

Account Type Accounts Payable

Detail Type Accounts Payable (A/P)

Name Accounts Payable (A/P)

24 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Expense account:

Account Type Expenses

Detail Type Office/General Administrative

Name Depreciation Expense

Number 607

Financial Statement Profit and Loss

CERTIFICATION Q&A PRACTICE TEST Certification Q&A multiple-choice questions are available within Connect. Students can complete the practice test within Connect, and it is auto-graded.

For Chapters 1 through 12, the Certification practice test includes 10 multiple-choice questions for each chapter. Certification Q&A is mapped to the QuickBooks Certification Exam Objectives.

To see how the chapters are aligned with the exam objectives, go online to Instructor Resources > Certification Exam Objectives > open the QBO Certification Exam Objectives file.

Certification Q&A, is aligned with these exam objectives: Setup and Maintenance, List Management, and Reports.

FILES SAVED IN CHAPTER 2

The Chart below shows the PDF and Excel files saved in Chapter 2 and Exercise 2-2.

Chapter/Exercise 2

2-2

PDF & Excel

Page No.

Chapter 2_Chart of Accounts.pdf

65-66

Chapter 2_Chart of Accounts.xlsx

66

Exercise 2-2_Chart of Accounts.pdf

71

Exercise 2-2_Chart of Accounts.xlsx

71

Instructor Resources includes PDF Reports and Excel Reports. The file names are the same as what is shown in the textbook, and are listed in alphabetic order. Scroll down the screen to see both Chapter reports and Exercise reports.

25 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Scroll down for exercises.

For access to the Instructor Resources, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 3 BEGINNING BALANCES AND OCTOBER TRANSACTION REGISTER INSTRUCTOR’S MANUAL

OBJECTIVES

21.

22.

23.

24.

25.

26.

27.

28.

29.

30.

Start QBO+ and sign into Student Name Sales and Service (your first and last name).

Customize the Account List or Chart of Accounts.

Enter the owner’s investment in the business.

Use a transaction register to write checks.

Record cash sales, set up sales tax, and complete a transfer of funds.

Display the Bank Register, Journal, Trial Balance, Balance Sheet, Income Statement, and Audit Log. Export reports to Excel and PDF. Complete Check Your Progress.

Complete the QuickBooks Online Resources and Activities.

Complete Exercises 3-1, 3-2, 3-3, and Certification Q&A practice test.

26

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

QBO Tips    



Each time QBO is started, the User ID and Password is needed. Or, a code can be sent to a cell phone. Students have a one-year subscription to QBO Plus.

Using the non-expiring QBO Accountant version, professors can hyperlink to student work.

Link to your students’ accounts from Intuit’s Educator Portal.

When QBO updates, accounts may be added to the Chart of Accounts (also called the Account List) and some may not have account numbers.

The acronym DAVE (Data metrics, Analysis, Visualization, Evaluation) is used to identify QBO’s data images. When transactions are recorded, the Dashboards show changes graphically on bar and pie graphs, and line charts for Profit and Loss, Expenses, Invoices, Income Over Time, and Sales. For Bank Accounts, a link is available to go to registers.

When the acronym DAVE is used, tasks involve analyzing data that QBO graphically illustrates.

27 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

QUICKBOOKS RESOURCES AND ACTIVITIES Connect: One or more of the following may be assigned for auto-grading and feedback.

Connect eBook Releases McGraw-Hill Connect® publishes the eBook twice a year for Fall and Spring semesters. For example, there is a Summer 2024 eBook Release for Fall semester, and a Winter 2025 eBook Release for Spring semester.

8. Assignable In-Chapter and End of Chapter Material:  Check Your Progress.  Exercises 3-1 and 3-2.  Exercise 3-3: Problem Solving.

9. Analysis Questions.

10. Quizzes.

8. Test Bank.

9. Certification Q&A questions.

10. Additional student resources (ASR).

11. SmartBook > + Add Assignment > select SmartBook 2.0 (or later) > New Assignment > select Chapter(s) > Continue > select Content. If all of Chapter 3 Content is selected, it looks like this.

28 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

g. Click Continue > enter an Assignment name (e.g., Chapter 3). h. Enter start date and due date (not the same as previous chapter) > enter preferred score > Assign. i. An example of the author’s SmartBook assignments are shown for Chapters 1-5. You may want to have students’ complete SB for Chapters 1 through 12. In addition to completing Connect’s Certification Q&A practice tests, SmartBook is a good way to prepare for the third-party, fee-based, Certification test from Certiport.

Additional Student Resources (ASR)

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

5. Access QBO Sign Up. 6. Narrated PowerPoints.

7. QBO Videos. Links to the videos are included on the PowerPoints.

a. b. c. d.

Use Journal Entries Recording and printing checks Adding vendors Accounting Terms You Need to Know 29

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

e. f. g. h. i. j.

Video center Intuit QuickBooks channel In the know video series Learn about QBO with how-to-videos Training videos Webinars and events

8. Text Updates.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

          

Instructor’s Manual for Chapters 1-12.

Instructor PowerPoints Excel Reports and PDF Reports. Excel and PDF files are saved in each chapter. Refer to the Files Saved in Chapter 3 chart on page 37.

Certification Exam Information.

Instructor PowerPoints.

Intuit Educator Portal.

QBO Access, System Requirements, Intuit Support, and Resources.

Syllabi.

Test Bank for Chapters 1-12.

Instructor preview for Connect assignments—Multiple-choice and True False quizzes, Analysis Questions, Check Your Progress, Chapter work and End-of-Chapter Exercises, Problem Solving, Certification Q&A quiz. Connect assignments are auto-graded.

Additional Student Resources: Access QBO Sign Up, Certification Info, Narrated PowerPoints, Intuit Support, QBO Videos, and Text Updates. Text Updates includes links to Yacht Text Updates (eBook updates), Text Update Archive File (print 4th edition), Chart of Accounts video, and the Exercise 2-2 Chart of Accounts.pdf file. The PowerPoints include links to videos.

To access the Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWER TO ANALYSIS QUESTION The Chapter 3 Analysis Question is included within Connect. Student responses are auto-graded.

How do you edit a transaction? List two options.

30 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

ANSWER:

1. With the Audit Log shown, drill down to the transaction that needs editing. The original entry is shown. Make the needed corrections, then save. When you view the Audit Log again, the edited transaction is shown.

2. Go to Recent Transactions by selecting the magnifying-glass icon. To edit, link to the transaction. Make the needed changes, then save.

MULTIPLE-CHOICE QUESTIONS

The multiple-choice and true false quizzes are within Connect. The answers are shown below and within Connect’s Instructor login. In Connect, students’ responses are auto-graded.

3. Written evidence of business transactions.

F. G. H. I. J.

Desktop.

Dashboards.

Source document Cloudware.

None of these.

4. To record the owner’s investment, what selection is made?

F. G. H. I. J.

Income.

Expenses.

Gear > Account and Settings. + > Journal Entry.

All of these.

3. A journal entry is a transaction in which:

F. G. H. I. J.

There are at least two parts - a debit and credit.

Debit and credit distribution lines.

Each line has an account from the chart of accounts.

The total of the debits and credits equal.

All of these.

31

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

4. Checks, payments, bills, bank deposits, and transfers are entered on:

F. G. H. I. J.

The general journal.

Specialized screens.

Activities.

Dashboards.

None of these.

5. The October transaction register shows the:

F. G. H. I. J.

Transactions completed for October.

General journal.

Dashboards.

Checking account activity.

All of these.

6. You can transfer funds between most balance sheet accounts except:

F. G. H. I. J.

Accounts Payable and Accounts Receivable accounts.

Account 101 Checking and Account 205 Loan Payable.

Cash and sales.

Customer and vendor accounts.

None of these.

7. Which QBO feature is used to view the company’s financial information?

F. G. H. I. J.

Account listing.

Reports.

Chart of accounts.

Registers.

All of these.

8. This report lists what you own, your debts, and what you’ve invested.

32 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

F. G. H. I. J.

Audit log.

Balance Sheet.

Profit & Loss.

General journal.

All of these.

9. This report shows the debit and credit balance of each account.

F. G. H. I. J.

Audit log.

Balance Sheet.

Profit & Loss.

Trial Balance.

None of these.

10. This report shows money you earned and money you spent.

f. g. h. i. j.

Trial Balance.

Journal.

Profit & Loss.

Balance Sheet.

All of these.

True or False: The True or False quizzes are within Connect.

11. In Chapter 3, the owner invests cash and computer equipment in the business.

True

12. The company, Student Name Sales and Service, was started in December of the current year.

False. The first month of operations is October of the current year.

13. In Chapter 3, the transaction register is used as a source document for recording transactions.

33 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

True.

14. The transaction register shows each customer’s account activity.

False. The transaction register shows Student Name Sales and Service’s checking account activity.

15. The account for recording a check to the U.S. Post office is Freight In. False. The account for recording U.S. Post Office checks is Account 627 Shipping and delivery.

16. The Sales Receipt window is used for recording cash sales.

True

17.

The account distribution for expenses is a credit to Account 101 Checking and a debit to Account 401 Sales.

False. The expenses account distribution is a debit to the appropriate expense account and a credit to Account 101 Checking.

18. The account distribution for cash sales is a debit to Account 101 Checking and a credit to Account No. 401 Sales.

True

19.

The account distribution for the transfer of funds for the loan payable is a debit to Account No. 101 Checking and a credit to Account 205 Loan Payable.

34 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

True

20.

On the Dashboards, Profit and Loss and Expenses are shown graphically.

True

CHECK YOUR PROGRESS

Within Chapter 3, students complete Check Your Progress.

Indicate whether the balance is a debit (dr.) or credit (cr.). In Connect, student responses are auto-graded. These account balances reflect October 1-17, 20XX transactions.

7. Account 101 Checking

48,128.79 (dr.)

Account 205 Loan Payable

5,000.00 (cr.)

Account 207 Arizona Department of Revenue Payable Account 401 Sales

152.50 (cr.)

2,500.00 (cr.)

Account 621 Office Supplies & Software

106.52 (dr.)

Account 633 Telephone Expense

76.19 (dr.)

Account 635 Utilities Expense

79.00 (dr.)

2. What is the 10/17/XX Net income?

1,976.29

3. What are the total Liabilities and Equity?

67,128.79

4. What report(s) show the Net Income?

Profit & Loss, Balance Sheet, Statement of 35

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Cash Flows

5. What report(s) show all work completed?

Audit Log, Recent Transactions

6. What transactions changed the Dashboards data metrics from October 1 through October 17 for Profit and Loss, Expenses, Sales, and Bank Accounts?

Specify account name, account balances, totals, and the calculation. Where appropriate, indicate whether the amounts have a dr. or cr. Balance. Some amounts are rounded up.

Profit and Loss: total net income for this year is $1,976. For sales, the amount is 2,500; for expenses, $524 Calculation, 2,500 - 524 = $1,976.

Expenses: total expenses for this fiscal year are $523.71 from checks 1010 to 1017. The accounts are 625 Repairs & Maintenance, $140, dr.; 621 Office Supplies & Software, $106.52, dr.; 635 Utilities Expense, $79, dr.; Everything else, $198.19, dr. Calculation: 140 + 106.52 + 79 + 198.19 = $523.71. (Amount is rounded up on the Profit and Loss bar graph.)

Sales: total sales for this fiscal year is $2,500 from Cash sales.

Bank Accounts: total bank account, $48,128.79, from 101 Checking, dr.

The bank account balance includes deposits and payments:

Deposits of $57,652.50 which includes a Transfer of $5,000; Cash sales of $2,500 plus sales tax of $152.50, for a total of $2,652.50; initial investment of $50,000. Calculation: 5,000 + 2,500.00 + 152.50 + 50,000 = $57,652.50

Payments of $9,523.71 which is the total of checks 1010 to 1017.

Calculation: Deposits – Payments: 57,652.50 – 9,523.71 = $48,128.79.

7. What QBO features are used for entering the beginning balance, transaction register expenses, cash sales.

36 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Beginning balance: +New > Journal entry.

Expenses: +New > Check.

Cash sales: +New > Sales receipt.

EXERCISE 3-1

Students use the transaction register to complete October 19 through October 30 checks and cash sales.

On the transaction register, checks are shown as payments and cash sales are shown as deposits. Use Sales Receipts to record cash sales and the appropriate expense to record checks. For Cash Sales, on the Sales Receipt screen, click Based on location to calculate the tax amount.

EXERCISE 3-2

Students export reports to Excel and save as PDF reports.

EXERCISE 3-3: PROBEM SOLVING Exercise 3-3 Problem Solving is available within Connect. In Connect, student responses are auto-graded.

1. What is the date of the beginning balance?

October 1, 20XX

2. Describe the beginning balance transaction type and the account distribution.

The beginning balance is a Journal Entry. The account distribution is:

Debit 101 Checking

50,000.00

135 Computer Equipment

10,000.00

Credit

37 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

301 Common Stock

60,000.00

3. What are the steps for accessing the report that shows the beginning balance?

The Account List, Chart of Accounts, or the Journal report shows the beginning balance. For the Account List, go to Reports > type Account List in the search field. Or, go to Gear > Chart of Accounts.

For the Journal report, go to Reports > type Journal in the search field.

4. When you set up sales tax, what areas are set up automatically?

1) Physical business location.

2) Total tax standard rate.

5. Using the Dashboards data metrics for Profit and Loss, Expenses, Sales, and Bank Accounts, what is the difference between the October 17 balances and October 30 balances?

Data Analysis Profit and Loss (rounded) Expenses Sales Bank Accounts

October 30 4,458.00 1,542.44 6,000.00 50,823.56

October 17 1,976.00 523.71 2,500.00 48,128.79

Difference 2,482.00 1,018.73 3,500.00 2,694.77

6. Instead of the Dashboards data metrics, what is another way 10/17 and 10/30 balances for Profit and Loss, Expenses, Sales, and Bank Accounts can be checked?

From the Navigation Bar, select Reports > Profit and Loss for 10/1 to 10/17 and again for 10/1 to 10/30. The Profit and Loss statement shows Sales Income, total Expenses and Net Income.

Reports > Balance Sheet to check 10/17 and 10/30 balances for Bank Accounts. Net Income is also shown.

CERTIFICATION Q&A PRACTICE TEST

Certification Q&A multiple-choice questions are available within Connect.

For Chapters 1 through 12, the Certification practice test includes 10 multiple-choice questions for each chapter. Certification Q&A is mapped to the QuickBooks Certification Exam Objectives.

38 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

To see how the chapters are aligned with the exam objectives, go online to Instructor Resources > Certification Exam Objectives > open the QBO Certification Exam Objectives file.

Certification Q&A, is aligned with these exam objectives: List Management, Basic Accounting, Reports, Saving Time.

FILES SAVED IN CHAPTER 3: The chart shows the PDF and Excel files saved in Chapter 3 and Exercise 3-2.

Chapter/ Exercise 3

PDF & Excel Chapter 3_Account List Student Name Sales and Service

Page 76

*The file name includes students’ first and last names+

3-2

Chapter 3_Oct 1 to Oct 17_Journal

98

Chapter 3_Oct 1 to Oct 17_Trial Balance

99

Chapter 3_Oct 1 to Oct 17_Profit and Loss

100

Chapter 3_Oct 1 to Oct 17_Balance Sheet

101

Exercise 3-2_October Journal

107

Exercise 3-2_October Trial Balance

107

Exercise 3-2_October Profit and Loss

107

Exercise 3-2_October Balance Sheet

107

Links to both the Chapter files and Exercise files are listed. The file name is the same as those shown in the textbook and on the chart. Scroll down to see both Chapter files and Exercise files. For access to the Instructor Resources, contact the McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 4 VENDORS AND INVENTORY INSTRUCTOR’S MANUAL OBJECTIVES 39 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

31. Start QuickBooks Online and sign into Student Name Sales and Service.

32. Complete Check Your Data: Data metrics and visualization, Expense and Sales transactions, and the October 30 Trial Balance.

33. Complete bank reconciliation with the October bank statement.

34. Enter new vendors.

35. Enter inventory products and services.

36. Record vendor transactions.

37. Print reports and financial statements.

38. Filter the audit log.

39. Export reports to Excel and PDF. 40. Complete Check Your Progress.

41. Review and complete the QuickBooks Resources and Activities.

42. Complete Exercises 4-1, 4-2, 4-3 and Certification Q&A practice test.

QBO Tips 

  

To make sure students are starting in the correct place in the data, complete the Check Your Data section at the beginning of Chapter 4. Students verify their Dashboards graphs, Profit & Loss and Expenses, Bank Accounts and Income Over Time, Expense Transactions, Sales Transactions, and the October 30 trial balance.

The Vendor Contact List includes Vendors that are paid immediately with a check, or paid later for purchases on account.

When the acronym DAVE is used, tasks involve analyzing QBO Dashboards graphs.

What if student’s reconciliation report is incorrect? Undo Reconcile is available from within the QuickBooks Online Accountant version. Students use QuickBooks Online Plus. To use Undo Reconcile, follow the steps on the next page.

40 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

1. Instructor signs up for QuickBooks Online Accountant for Educators at https://www.intuit.com/partners/education-program/products/quickbooks/educatorqbo-signup/. Instructors can hyperlink to student accounts from within QuickBooks Online Accountant.

2. For detailed information, go online to Instructor Resources > Intuit Educator Portal..

3. Instructor logs into QBO Accountant > selects Clients > QB next to student’s company > Reports > Reconciliation Report > highlight the report > View report > Undo.

QBO+ Checklist

The work in Chapters 2 through 10 is cumulative. To verify that chapter tasks are completed correctly, use the QBO+ Checklist.

1. Regularly check Text Updates.

2. When setting up QBO+, answer the setup questions.

3. Make sure Accountant view is being used: select ⚙ > “You’re viewing QuickBooks in Accountant view” is shown.” (If needed, Switch.)

4. Complete Account and settings preferences 5. On the Chart of Accounts, make sure accounts are classified correctly. Check Figure 2-38A and the Exercise 2-2_Chart of Accounts file.

6. Journalize entries correctly and: a. Verify work with the “Check Your Data” section of Chapters 3 through 10, textbook Figures, and Connect for exercises and questions. b. If Reports are not correct, recheck Chart of Accounts Type and Detail type selections; and, if needed, edit the Chart of Accounts and Journal entries. c. After correcting the Chart of Accounts and/or Journal, display Reports.

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

12. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercises 4-1 and 4-2.  Exercise 4-3: Problem Solving.

13. Analysis Questions.

41 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

14. Quizzes.

15. Test Bank.

16. Certification Q&A questions.

17. Additional student resources (ASR).

18. SmartBook > + Add Assignment > select SmartBook 2.0 (or later) > New Assignment > select Chapter(s) > Continue > select Content. If all of Chapter 4 Content is selected, it looks like this.

j. Click Continue > enter an Assignment name (e.g., Chapter 4). k. Enter start date and due date (not the same as previous chapter) > enter preferred score > Assign.

In addition to completing Connect’s Certification Q&A practice tests, SmartBook is an additional way to prepare for the third-party, fee-based, Certification test from Certiport.

Additional Student Resources (ASR) 42 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

5. Narrated PowerPoints.

6. QBO Videos. Links to the videos are included on the PowerPoints. a. Add your products and services b. How to add and paying bills c. Tracking expense reports

d. e. f. g. h. i.

Intuit QuickBooks channel Video center In the know video series Learn about QBO with how-to-videos Training videos Webinars and events

7. Text Updates.

TEXT UPDATES: The digital eBook is published twice a year for Fall and Spring semesters. For example, there is a Summer 2024 eBook Release for Fall semester, and a Winter 2025 eBook Release for Spring semester.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

        

Instructor’s Manual for Chapters 1-12.

Instructor PowerPoints.

Excel Reports and PDF Reports. Excel and PDF files are saved in each chapter. Refer to the Files Saved in Chapter 4 chart on pages 49-50.

Certification Exam Information.

Instructor PowerPoints.

Intuit Educator Portal.

QBO Access, System Requirements, Intuit Support, and Resources.

Syllabi.

Test Bank for Chapters 1-12.

43

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

 

Instructor preview for Connect assignments—Multiple-choice and True False quizzes, Analysis Questions, Check Your Progress, Chapter work and End-of-Chapter Exercises, Problem Solving, Certification Q&A quiz. Connect assignments are auto-graded.

Additional Student Resources: Access QBO Sign Up, Certification Info, Intuit Support, Narrated PowerPoints, QBO Videos, and Text Updates. Text Updates includes links to a Chart of Accounts video and the Exercise 2-2 Chart of Accounts.pdf file. The PowerPoints include links to videos.

To access the Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWER TO ANALYSIS QUESTIONS

The Chapter 4 Analysis Questions are included within Connect. Student responses are auto-graded.

1. What are vendors?

ANSWER

Vendors are the businesses that offer credit to buy merchandise and/or assets.

2. What is Accounts Payable and how do you verify its balance?

ANSWER

Accounts Payable is the amount of money the business owes. The Accounts Payable balance and the total of the amount owed to vendors should be the same.

3. Why is the balance in Merchandise Inventory different than the balance in Accounts Payable? Include account balances as of November 12 (completed in Exercise 4-2) in your answer. Explain.

44 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

ANSWER:

Merchandise Inventory includes products sold for Cash and purchases made on account. The balance in Accounts Payable is different because it represents merchandise purchases made on account only. The Merchandise Inventory account includes both purchases made on account and inventory sold for cash.

Purchases made on account as of November 12, 20XX are $17,920.

The Merchandise Inventory account balance is $12,920. The $5,000 difference ($17,920 - 12,920) represents the cost for computers sold for cash on 11/9, 11/10, and 11/12: $500 cost X 10 computers sold equals $5,000. (Hint: The October 1 - November 12, 20XX Transaction Report shows the total for 115 Merchandise Inventory as $12,920.00. Cash Sales are shown with a minus balance.)

MULTIPLE-CHOICE QUESTIONS

The multiple-choice and true false quizzes are within Connect. The answers are shown below and within Connect’s Instructor login. In Connect, students’ responses are auto-graded.

5. Merchandise purchased from vendors needs to be paid within: K. 10 days.

L. 20 days.

M. 30 days.

N. End of the month.

O. None of these.

6. Student Name Sales and Service receives a bank statement every: K. Quarter.

B. Month.

C. Week.

D. Day. E. None of these.

45 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

3. The process of bringing the balance of the bank statement and the balance of the checking account into agreement is called?

K. The trial balance.

L. The balance sheet.

C. Bank reconciliation.

D. Checking account register.

E. All of these.

4. The default for reports is:

K. Cash basis.

L. Accrual basis.

M. Account reconciliation.

N. Transaction register.

O. None of these.

5. Purchases on account from vendors are known as:

K. Vendor contact list.

L. Transaction details by account.

M. Sales receipts.

N. Accounts payable transactions.

O. None of these.

6. When reconciled, Account 101 Checking shows the same balance as:

K. Account 201 Accounts Payable.

L. Account 115 Merchandise Inventory.

M. Cash and sales.

N. Bank statement.

O. None of these.

46 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

7. This feature shows information about suppliers who offer credit to QBO:

K. Products and Services.

L. Vendors screen.

M. Reports.

N. Registers.

O. All of these.

8. Checks that are issued are shown on this report:

K. Register, Account 101 Checking.

L. Balance Sheet, Account 201 Accounts Payable.

M. Sales Receipts.

N. AP Aging Summary.

O. All of these.

9. To view all the vendors added in Chapters 3 and 4, display this report:

K. Transaction Detail by Account.

L. Trial Balance.

M. Profit and Loss.

N. Vendor Contact List.

O. None of these.

10. A product that is purchased from vendors for sale to customers is called:

k. Supplies. l. Transaction. m. Inventory. n. Balance of Account 201 Accounts Payable. o. All of these.

True or False:

47 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

11. The Vendors screen is where the company keeps track of the suppliers you work with.

True

12. QBO’s accounts payable system shows vendor activity.

True.

13. In Chapter 4, to make sure you are starting in the correct place in the data, display the November 12 trial balance.

False. To make sure you are starting in the correct place in the data, display data metrics, Expense and Sales transactions and the October 30 trial balance.

14. The transaction register shows the company’s checking account.

True.

15. The trial balance shows which checks, ATMs, and deposits cleared the bank.

False. The bank statement shows which checks, ATMs, and deposits cleared the bank.

16. Since Student Name Sales and Service buys on credit from various vendors, the business wants to keep track of the amount owed and the due dates of bills.

True.

17. Recording the purchase of an inventory item increases Account 115 Merchandise Inventory on the Balance Sheet by the cost of the item and increases the Quantity on Hand for that item.

True.

48 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

18. Recording the sale of an inventory item increases the Inventory Asset account by the original cost of the item.

False. Recording the sale of an inventory item decreases the Inventory Asset account by the original cost and decreases the Quantity on hand for that item.

19. Information about a purchase is recorded by selecting + New > Sales Receipts.

False. Information about a purchase is recorded by selecting + New > Bill.

20. The account distribution for a bill is a debit to Account 115 Merchandise Inventory and a credit to Account 201 Accounts Payable/Vendor.

True

CHECK YOUR PROGRESS

Within Chapter 4, students complete the Check Your Progress assignment. Also available within Connect. In Connect, student responses are auto-graded. These account balances are as of 11/3/20XX.

8. Account 101 Checking Account 115 Merchandise Inventory Account 201 Accounts Payable Account 207 Arizona Department of Revenue Payable Account 601 Advertising & Marketing Account 603 Bank Charges & Fees Account 629 Stationery & Printing

$50,343.19 (dr.) $2,420.00 (dr.) $2,420.00 (cr.) $366.00 (cr.) $250.00 (dr.) $20.00 (dr.) $553.18 (dr.)

2. What is the 11/3 Net Income?

$3,977.19

3. What is the 11/3 total Liabilities and Equity?

$71,763.19

4. What is the quantity and asset value of data storage?

20, $300

5. What is the quantity and asset value of network products:

10, $250

49 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

6. What is the quantity and asset value of web servers?

7. What is the quantity and asset value of webinars?

8, $1,600

6, $270

8. Using the Dashboard graphs, answer these questions. a. What graph is used to report Net income for the year?

Profit and Loss

b. In what month were sales completed?

October 20XX

9. Where does the Dashboards show “Everything else?” What is its balance? From the Dashboards, how do you access the report that lists its accounts? What accounts shows Everything else’s total? Show your calculation.

Everything else: Expenses pie graph, 985.12

Drill down on the Profit and Loss bar graph to go to the P&L report. Expenses lists each account.

Account Number 601 629 633 Subtotal Everything Else Total Expenses

Account Name Advertising &Marketing Stationery & Printing Telephone Expense

Account Balance and Total 250.00 553.18 234.51 1037.69 985.12 2,022.81

Debit/Credit Dr. Dr. Dr.

50 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Calculation: 985.12 + 1037.69 = $2,022.81 Total Expenses EXERCISE 4-1

Students add vendors and products, complete transaction register entries, vendor transactions, and cash sales. Cash sales include Sales Tax for Arizona State, Pima County at 6.10%.

EXERCISE 4-2

Students save reports as PDF files and export reports to Excel.

EXERCISE 4-3, PROBLEM SOLVING

Exercise 4-3 Problem Solving is available within Connect. In Connect, student responses are auto-graded.

The questions and answers are also shown below.

51 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

1.

What report lists the debits and credits for each transaction? Show the total on November 12.

ANSWER: The Journal lists the debits and credits for each transaction. The total of October 1 thru November 12 journal transactions is $116,326.41.

2.

Identify the report that shows revenue and expenses. Explain how to display this report and the final balance.

ANSWER: The Profit and Loss shows income and expenses. Go to Reports > Favorites > Profit and Loss >10/1/20XX to 11/12/20XX > Run Report. The Net Income is $8,569.59.

3.

Identify the report that shows assets, liabilities, and equity. Show the steps for displaying that report, and the final balance(s).

ANSWER: The Balance Sheet lists what you own (assets), what your debts are (liabilities), and what you’ve invested in your company (equity). Go to Reports > Favorites > Balance Sheet > 10/1/20XX to 11/12/20XX > Run Report. Total assets and Total liabilities and equal are $92,465.59.

4. Using the Income over time line graph for This year, click on the October 20XX and November 20XX dots. What is the October revenue? What is the November revenue? On the income over time line graph shown below, what type of transaction accumulated as revenue?

ANSWER: In October, there is $6,000 of revenue. In November there is $10,000 of revenue. On the Income over time line graph, cash sales are the type of transactions that accumulated as revenue.

52 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

CERTIFICATION Q&A PRACTICE TEST

Certification Q&A multiple-choice questions are available within Connect.

For Chapters 1 through 12, the Certification practice test includes 120 Multiple-Choice questions (10 multiple-choice questions for each chapter). The Certification Q&A are aligned with the Objective Domains shown on this file, QBU_Online Exam Objectives.pdf.

FILES SAVED IN CHAPTER 4

The chart shows the PDF and Excel files saved in Chapter 4 and Exercise 4-2.

Chapter/ Exercise 4

PDF & Excel

Page

Chapter 4_October 31 Reconciliation Report

119

Chapter 4_October 31 Trial Balance

121

Chapter 4_Vendor Contact List

129

Chapter 4_Product Service List

138

Chapter 4_Journal

141

Chapter 4_Transaction Detail by Account

142

Chapter 4_Trial Balance

143

Chapter 4_Inventory Valuation Summary

144

Chapter 4_Vendor Balance Summary

144

Chapter 4_AP Aging Summary

145

Chapter 4_Profit and Loss

146

53 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

4-2

Chapter 4_Balance Sheet

147

Chapter 4_Statement of Cash Flows

148

Exercise 4-2_Vendor Contact List

154

Exercise 4-2_Product Service List

154

Exercise 4-2_Journal

154

Exercise 4-2_Transaction Detail by Account

154

Exercise 4-2_Trial Balance

154

Exercise 4-2_Inventory Valuation Summary

154

Exercise 4-2_Vendor Balance Summary

154

Exercise 4-2_AP Aging Summary

154

Exercise 4-2_Profit and Loss

154

Exercise 4-2_Balance Sheet

154

Exercise 4-2_Statement of Cash Flows

154

Instructor Resources lists the Excel and PDF reports in alphabetic order. For access to Instructor Resources, professors contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 5 CUSTOMERS AND SALES INSTRUCTOR’S MANUAL

OBJECTIVES

43. Start QuickBooks Online and sign in to Student Name Sales and Service (your first and last name).

44. Complete Check Your Data: Data metrics and visualization, Expense and Sales transactions, and the October 30 Trial Balance.

45. Enter customer settings.

46. Enter new customers, cash sales, customer sales, and sales tax.

47. Complete an advanced search.

54 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

48.

49.

50.

51.

52.

53.

Display financial statements and customize reports.

Display the audit log.

Export reports to Excel and Adobe PDF. Complete Check Your Progress.

Review and complete the QuickBooks Online Resources and Activities.

Complete Exercises 5-1, 5-2, 5-3, and Certification Q&A practice test.

QBO Tips     

To make sure students are starting in the correct place in the data, complete the Check Your Data section at the beginning of Chapter 4. Students verify the Dashboards graphs, Expense and Sales transactions, and the November 12, 20XX Trial Balance.

The Customer Contact List shows customers that Student Name Sales and Service sells products on account, meaning credit transactions or accounts receivable transactions.

Arizona sales tax of 6.10% is added for cash sales and credit card sales (Sales Receipts), and for sales on account (Invoices) to Permanente Medical Service and WebPro. Illinois sales tax of 6.25% is added to sales on account for Springfield Unified School District.

Accounts receivable are what customers owe your business.

55 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

SALES TAXES

Sometimes sales tax rates change which means QBO’S automatic calculation will change on the Sales Receipt or Invoice screen. If the automatic calculation changes, you need to use the sales tax amount shown within the textbook’s transaction.

What if the sales tax amount automatically calculated does not agree with the transaction? Students can override the amount shown. Click on the amount > type the Amount shown for sales tax > Reason, Other > click <Confirm>. (Hint: The sales taxes shown in the textbook are for demonstration purposes.)

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

19. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercises 5-1 and 5-2.  Exercise 5-3: Problem Solving.

20. Analysis Questions.

21. Quizzes.

22. Test Bank.

23. Certification Q&A questions.

24. Additional student resources (ASR).

Additional Student Resources (ASR)

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

8. Narrated PowerPoints.

9. QBO Videos. The PowerPoints include links to the videos.

a. Adding your customers b. Customer sales settings 56 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

c. d. e. f. g. h. i. j. k.

Record your sales: reports, invoices, & more Recording sales of inventory products Adding columns to reports Intuit QuickBooks channel Video center In the know video series Learn about QBO with how-to-videos Training videos Webinars and events

10. Text Updates.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

To access Connect and Instructor Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWER TO ANALYSIS QUESTION The Chapter 5 Analysis Questions are included within Connect. Student responses are auto-graded. Also, shown below.

4. What is the account distribution for the 11/15/20XX sale on account of 5 data storage products to eBiz for a total of $150, Invoice 1007?

Account 105 Accounts Receivable/eBiz 501 Cost of Goods Sold 115 Merchandise Inventory 401 Sales

Debit 150.00 75.00

Credit

75.00 150.00

5. What is the account distribution for selling one web server for cash, $400; Arizona sales tax, $24.40, Sales Receipt 1013 on 11/30/20XX?

57 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Account

Debit 424.40 200.00

101 Checking 501 Cost of Goods Sold 401 Sales 115 Merchandise Inventory 207 Arizona Department of Revenue Payable 207 Arizona Department of Revenue Payable

Credit

400.00 200.00 22.40 2.00

MULTIPLE-CHOICE QUESTIONS:

The multiple-choice and true false quizzes are within Connect. The answers are shown below and within Connect’s Instructor login. In Connect, student responses are auto-graded.

7. Before adding customers, Check QBO’s: P. Q. R. S. T.

Vendors.

Inventory.

Account and Settings.

Products and services list.

All of these.

8. The Customers screen includes the: L. Adding a new customer.

B. Customer list.

C. Create invoice.

D. Export to Excel.

E. All of these.

3. When cash sales are recorded, use:

M. Invoice.

N. Bill.

C. Customer payment.

D. Sales Receipt.

E. None of these.

58 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

59 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

4. What customers owe your business is known as:

P. Q. R. S. T.

Accounts payable.

Invoices.

Accounts receivable.

Account register.

All of these.

5. The following transaction affects the customer’s balance:

P. Credit memo.

Q. A/P transaction.

R. Bill.

S. Register.

T. None of these.

6. To see customer transactions and account balances, display the:

P. Q. R. S. T.

A/P Register.

Trial Balance.

A/R Register Sales Receipts.

None of these.

7. Products and services are associated with this type of account:

P. Expenses.

Q. Income.

R. Settings.

S. Liabilities.

T. None of these

8. In this type of report, each transaction’s debit and credit is shown:

A. A/R Aging Summary.

B. Journal.

60 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

C. A/R Register.

D. Trial Balance.

E. None of these.

9. The inventory valuation summary shows:

P. Q. R. S. T.

Quantity.

Asset value.

Average cost.

Account 115 Merchandise Inventory account balance.

All of these.

10. The Audit Log displays events that occurred in:

p. q. r. s. t.

Daylight savings time.

Mountain Standard Time.

Eastern Standard Time.

Your local time.

None of these.

True or False:

11. The focus of Chapter 5 is customers and sales.

True

12. Starting data is displayed for 11/1/20XX. False. Starting data is displayed for 10/1/20XX to 11/12/20XX. 13. A sales receipt is used for customer sales on account.

False. An invoice is used for customer sales on account.

61 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

62 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

14. Credit transactions from customers are accounts payable transactions.

False. Credit transactions from customers are accounts receivable transactions.

15. Credit memos apply returns to the customer’s balance.

True.

16. Registers can be used to look at transactions and account balances.

True.

17. The November bank statement shows checking account activity through 10/30/20XX. False. The November bank statement shows checking account activity through 11/30/20XX.

18. On invoices and other sales transactions, you choose products and services.

True.

19. For cash and credit card sales, no sales taxes are included.

False. Cash and credit card sales include sales tax.

20. The account distribution for an invoice includes debits to Account 105 Accounts Receivable/customer and Account 501 Cost of Goods Sold; and credits to Account 401 Sales, and Account 115 Merchandise Inventory.

True

63 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

CHECK YOUR PROGRESS, CHAPTER 5

Within Chapter 5, students complete the Check Your Progress assignment. Also, included within Connect.

1.

What is the account balance from 10/1/20XX to 11/30/20XX in these accounts? Indicate whether these accounts have debit (dr.) or credit (cr.) balances.

Account 101 Checking

$62,549.89 (dr.)

Account 105 Accounts Receivable

$0.00 (dr.)

Account 115 Merchandise Inventory $11,960.00 (dr.)

Account 207 Arizona Department of Revenue Payable $1,055.30 (cr.)

Account 208 Illinois Department of Revenue Payable $25.00 (cr.)

Account 401 Sales

$17,920.00 (cr.)

Account 501 Cost of Goods Sold $5,960.00 (dr.)

Account 603 Bank Charges

2.

What is Net Income?

$9,509.59

3.

What are the total Liabilities and Equity?

$93,509.89

$40.00 (dr.)

4. What is the quantity, asset value, and average cost of computers?

16, $8,000, $500

5. What is the quantity, asset value, and average cost of data storage?

64 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

31, $465, $15

6. What is the quantity, asset value, and average cost of network products?

16, $400, $25

7. What is the quantity, asset value, and average cost of web servers?

13, $2,600, $200

8. What is the quantity, asset value, and average cost of webinars?

11, $495, $45

25. When the Profit and Loss and Balance Sheet were customized, what was the date of the previous period? How can you verify the account balances on the comparative P&L and customized Balance Sheet?

The Previous Period date is October 31, 20XX. To verify the October 31 and November 30 account balances, display or print the appropriate report for that ending date. Then compare the report balances to the comparative P&L and the customized Balance Sheet.

26.

Display the Dashboards graphs. Answer these questions.

a. How do you display Dashboards graphs?

Select Dashboard > Home. b. Profit and Loss: What is shown?

This year for Profit and Loss shows: Net income for this year, $9,510 (amount is rounded). c. Expenses: What is shown?

This fiscal year’s Total expenses are $8,410.41.

501 Cost of Goods Sold is $5,960 629 Stationery & Printing, $553.18 601 Advertising & Marketing, $375.

Everything Else, $1,522.23

65 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

d.

Sales: What are Total sales? What are the amounts for October and November?

This fiscal year shows Total Sales as $17,920.

Oct 20XX, $6,000 Nov 20XX, $11,920 e. What does Bank Accounts show?

101 Checking in QuickBooks, $62,549.89 EXERCISE 5-1

Students add two customers and complete transaction register entries, vendor payments, customer transactions, and cash sales.

EXERCISE 5-2

Students export reports to Excel and save as PDF files.

Exercise 5-3: Problem Solving: Exercise 5-3 Problem Solving is available within Connect. In Connect, student responses are auto-graded.

List three, or more, ways to show account balances for an asset and expense account. Include the QBO steps for each method. Specify the account and balance in your answer. What is the difference between View Register accounts and Run report accounts?

On the Account List or Chart of Accounts, the View register link is for balance sheet accounts (bank, current and fixed assets, liability, equity). The Run report link is for retained earnings, income, cost of goods sold, and expense accounts. Registers display transactions in a traditional ledger format.

Asset account: Account 101 Checking, Balance $62,549.89 1. Gear > Chart of Accounts (or Accounting button > Chart of Accounts). The QuickBooks Balance is shown for Account 101 Checking.

2. Gear > Chart of Accounts > View register for 101 Checking. Instead of View register, doubleclick 101 Checking.

3. Reports > Trial Balance > from 10/1/XX to 11/30/XX. 4. Reports > Balance Sheet (or Statement of Cash Flows) from 10/1/XX to 11/30/XX. 66 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

5. In the Bank accounts area, the Dashboards show 101 Checking In QuickBooks balance, $62,549.89.

Expense: Account 603 Bank Charges & Fees, Balance, $40.00 1. Reports > Profit and Loss > from 10/1/XX to 11/30/XX. 2. Reports > Transaction Detail by Account > from 10/1/XX to 11/30/XX. 3. Gear > Chart of Accounts (or Accounting button) >go to Account 603 > Run report.

CERTIFICATION Q&A PRACTICE TEST Certification Q&A multiple-choice questions are available within Connect. For this chapter, the certification practice test is mapped to these QuickBooks Online Certified User exam objectives: List Management, Sales/Money-in, Basic Accounting, Reports, Customization/Saving Time. Refer to QBO Certified User_Exam Objectives.pdf

FILES EXPORTED TO EXCEL AND SAVED AS PDF FILES IN CHAPTER 5

The chart below shows the PDF and Excel files saved in Chapter 5 and Exercise 5-2.

Chapter/ Exercise 5

PDF & Excel

Page

Chapter 5_Customer Contact List

168

Chapter 5_November 30 Reconciliation Report

185

Chapter 5_Product Service List

189

Chapter 5_Journal

191

Chapter 5_Transaction Detail by Account

193

Chapter 5_Trial Balance

193

Chapter 5_Inventory Valuation Summary

195

Chapter 5_Vendor Balance Summary

195

67 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

5

5-2

Chapter 5_AP Aging Summary

196

Chapter 5_Sales Tax Liability Report

196

Chapter 5_Profit and Loss

197

Chapter 5_Profit and Loss Comparison

198

Chapter 5_Balance Sheet

199

Chapter 5_October and November Balance Sheet

201

Chapter 5_Statement of Cash Flows

201

Exercise 5-2_Vendor Balance Summary

207

Exercise 5-2_AP Aging Summary

207

Exercise 5-2_Customer Contact List

207

Exercise 5-2_Journal

207

Exercise 5-2_Transaction Detail by Account

207

Exercise 5-2_Trial Balance

207

Exercise 5-2_Sales Tax Liability Report

207

Exercise 5-2_Inventory Valuation Summary

207

Exercise 5-2_Customer Balance Summary

207

Exercise 5-2_AR Aging Summary

207

Exercise 5-2_Profit and Loss

207

Exercise 5-2_Balance Sheet

207

Exercise 5-2_Statement of Cash Flows

207

Links to both the Chapter files and Exercise files are listed. For access to the Instructor Resources, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 6 DECEMBER SOURCE DOCUMENTS 68 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

INSTRUCTOR’S MANUAL

OBJECTIVES

54. Start QuickBooks Online and sign in to Student Name Sales and Service.

55. To check data, display the Dashboards graphs, expense and sales transactions and the December 1 Trial Balance.

56. Analyze source documents.

57. Record vendor, customer, cash and credit card transactions, and sales tax.

58. Complete financial statement comparisons.

59. Export reports to Excel and save as PDF files.

60. Complete Check Your Progress.

61. Review and complete the QuickBooks Online Resources and Activities.

62. Complete Exercises 6-1, 6-2, 6-3, and Certification Q&A practice test.

The purpose of Chapter 6 is to review what students have learned in previous chapters. After analyzing each source document, students record the appropriate transactions. All transactions occurred during December of the current year.

In Chapter 6, students analyze source documents then record transactions. These QBO features are used. 

Accounts payable and vendors.



Inventory.



Accounts receivable and customers.



Cash and credit card sales.



Account reconciliation.



Reporting.

QBO Tips 

The source documents analyzed include: o Vendor bills for purchasing inventory. o Memos include customer payments, vendor payments and remittances. o Transaction register for issuing checks for expenses and recording ATM withdrawals.

69

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

o Sales invoices for credit customers. o Sales receipts for cash and credit card sales.

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

27. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercise 6-1 and 6-2.  Exercise 6-3: Problem Solving.

28. Analysis Questions 29. Quizzes.

30. Test Bank.

31. Certification Q&A questions.

32. Additional student resources (ASR).

Additional Student Resources (ASR)

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

11. Narrated PowerPoints.

12. QBO Videos. The PowerPoints include links to the videos.    

Reconciling your accounts Creating inventory products Using inventory reports for tracking & more Intuit QuickBooks channel

   

In the know video series Learn about QBO with how-to-videos Training videos Webinars and events

13. Text Updates.

70 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

To access Additional Student Resources, Instructor Resources, and Connect, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWER TO ANALYSIS QUESTIONS, CHAPTER 6

The Chapter 6 Analysis Questions are included within Connect. Student responses are auto-graded. Also, shown below.

1. Is there a difference between the December 1-31 Profit and Loss and the October 1 to December 31 Profit and Loss? Explain and provide an example.

Yes. Because the P&L includes income accounts, cost of goods sold, and expenses – the temporary accounts – the P&L for a month will be different than the P&L for the entire fourth quarter. For example, the net income for October 1 through December 31 is $14,643.52. An accumulation of all the P&L accounts. The net income for the month of December is $5,133.93 reflecting one month of income, cost of goods sold, and expense account balances.

2. Is there a difference between the December 1-31 Balance Sheet and the October 1 to December 31 Balance Sheet? Explain.

No. The balance sheet shows the permanent accounts, Assets, Liabilities and Equity. The balance sheet for one month and the balance sheet for the entire quarter is the same.

3. Is there a difference between the December 1-31 Statement of Cash Flows and the October 1 to December 31 Statement of Cash Flows? Explain.

Yes. The statement of cash flows includes the net income amount, either for a month or the fourth quarter. The net income for the fourth quarter is $14,643.52. The net income for the month of December is $5,133.93. Therefore a statement of cash flows for one month will differ from one for three months.

71 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

The cash at the end of the period is the same but not the amounts for Operating Activities, Investing Activities and Financing Activities.

MULTIPLE-CHOICE QUESTIONS

The multiple-choice quizzes are within Connect. Also shown below.

9. When issuing checks or ATMs for expenses, refer to the: U. Vendor screens.

V. Accounts Receivable register.

W. Transaction register.

X. Products and services list.

Y. All of these.

10. To display multiple months on the Profit and Loss and Balance Sheet, make this selection.

M. The Balance Sheet can display one period only.

B. The P&L can display one period only.

C. Select Reports > Customer balance detail.

D. Customize dates and columns.

E. None of these.

3. Vendor purchases are tracked by the following:

O. Purchase order.

P. Net 30 terms.

C. Customer payments.

D. Bill number.

E. None of these.

72 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

4. When customers pay what they owe, the check is payable to:

U. Accounts receivable.

V. Craig’s Design and Landscaping Services.

W. Student Name Sales and Service.

X. Account 101 Checking.

Y. None of these.

5. The terms of vendor payments are:

U. Net 30.

V. End of month.

W. Net 60.

X. Vendor payments do not have terms.

Y. All of these.

6. The Sales Receipt screen is used for the following:

U. Vendor payments.

V. Purchases made on account.

W. Sales invoices on account.

X. Cash and credit card sales.

Y. None of these.

7. The trial balance account totals for the fourth quarter are the same as:

U. Transaction detail by account.

V. Balance sheet.

W. Profit and loss.

X. Statement of cash flows.

Y. None of these.

8. The Customer balance summary total agrees with this account balance:

73 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

F. G. H. I. J.

Account 101 Checking.

Account 115 Merchandise Inventory.

Account 105 Accounts Receivable Account 201 Accounts Payable.

None of these.

9. The vendor balance summary total agrees with this account balance:

U. Account 105 Accounts Receivable.

V. Account 115 Merchandise Inventory.

W. Account 501 Cost of Goods Sold.

X. Account 201 Accounts payable.

Y. All of these.

10. The inventory valuation summary shows:

u. The asset value. v. The average cost. w. The same balance as Account 115 Merchandise Inventory. x. The quantity of each item in inventory. y. All of these.

True or False:

11. The Reports Business overview section includes links to the Profit and Loss and Balance Sheet.

True.

12. A remittance is the action of sending money in payment of a bill.

True.

13. To make sure all entries have been recorded through Exercise 5-2, display the 11/2/20XX to 11/30/20XX trial balance.

False. Display the 10/1/20XX to 12/1/20XX trial balance.

74 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

14. In Chapter 6, all transactions occurred during November.

False. All transactions occurred during December.

15. When customer payments are received, use Sales Receipts.

False. Use the Receive Payment screen for customer payments.

16. Credit card receipts are entered on the Sales Receipt screen.

True.

17. Bills show a purchase amount as well as a remittance amount.

True.

18. Vendor payments are made on the Bill or invoice screen.

False. Vendor payments are made on the Bill Payment screen.

19. Sales on account are recorded on the Purchase Invoice screen.

False. Sales on account are recorded on the Invoice screen.

20. The inventory valuation summary shows all purchases made on account.

False. The inventory valuation summary shows the quantity, asset value, and average cost of inventory.

75 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

ANSWERS TO CHECK YOUR PROGRESS, CHAPTER 6

In Chapter 6, students complete the Check Your Progress assignment. Also, included within Connect.

2.

What are the account balances in these accounts from 10/1/20XX to 12/30/20XX? Indicate whether these accounts have debit (dr.) or credit (cr.) balances.

Account 101 Checking

$55,320.33 (dr.)

Account 105 Accounts Receivable

425.00 (dr.)

Account 115 Merchandise Inventory

9,870.00

(dr.)

Account 201 Accounts Payable 3,120.00 (cr.)

Account 207 Arizona Department of Revenue Payable 1,781.81 (cr.)

Account 208 Illinois Department of Revenue Payable 50.00 (cr.)

Account 401 Sales

31,140.00 (cr.)

Account 501 Cost of Goods Sold 12,570.00 (dr.)

2.

What Total is shown on the 12/30 Trial Balance?

$101,091.81

3.

4.

What is Net Income?

What are the total Liabilities and Equity?

$14,663.52

$84,615.33

5. What is the quantity, asset value, and average cost of computers?

11, $5,500, $500

76 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

77 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

6. What is the quantity, asset value, and average cost of data storage?

51, $765, $15

7. What is the quantity, asset value, and average cost of network products?

16, $400, $25

8. What is the quantity, asset value, and average cost of web servers?

14, $2,800, $200

9. What is the quantity, asset value, and average cost of webinars?

9, $405, $45

10. What is the cash increase at the end of the period?

$55,320.33

11.

What Dashboard graph reports income and expenses for the year? Identify the type of graph. What are the income and expense amounts? What other image shows these amounts, and what type of graph is used? (On the Dashboards, some amounts are rounded.)

The Profit and Loss bar graph shows income and expenses for the year. Income is $31,140; the Expenses are $16,476.

78 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Expenses also shows $16,476.48. (Amounts are rounded up on the Profit and Loss image.) A pie chart shows Expenses.

The Sales image, shows the same amount as total income: $31,140.

shown as a line chart,

Note: The author’s year is shown. Students’ month is the same; year differs.

12.

What dashboard graph reports invoices not due yet? What is the amount?

The Invoices image shows $425 not due yet.

79 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

EXERCISE 6-1

Using the December 31 bank statement, students reconcile Account 101 Checking.

EXERCISE 6-2

Students save reports as PDF files and export reports to Excel.

EXERCISE 6-3: Problem Solving: Exercise 6-3 Problem Solving is available within Connect. In Connect, student responses are auto-graded. The questions and answers are shown below.

The financial statements displayed in Figure 6-22 and Figure 6-24 are used for the answer.

1. On the Profit and Loss report, describe how to compare October, November and December.

Show calculations for determining percent of income for an expense account.

80 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

a. Display the Profit and Loss by Month report > Customize > from 10/1/XX to 12/30/XX > Run report. b. Click <Customize> > select Rows/Columns > % of Income. c. On the Profit and Loss by Month report, an expense account is divided by total income to determine the % of income. For example: 601 Advertising for October: 125/$6,000 = 2.08%.

2. Describe how the Balance Sheet can be customized. Show an example and two calculations – one for an asset and one for a liability. a. Display the 10/1/20XX to 12/30/XX balance sheet > Customize > Rows/Columns > Change Columns > % of Column > Run report. b. Each row is divided by $84,615.33 (the total assets and total liability and equity amount). For example, Account 115 Merchandise Inventory $9,870/$84,615.33 = 11.66%.

3. Using Dashboards graphs, describe how to display monthly sales differences. Include the month and each month’s balance, and total sales. a) Select Dashboards > Home > Sales > This fiscal year. The Sales line graph shows monthly balances.

September 20XX: $0.00 October 20XX: $6,000 November 20XX: $11,920 December 20XX: $13,220 Total sales are $31,140

b) What selection shows the cumulative data; identify the date range and the report?

January 1, 20XX through 12/31/20XX. To see cumulative data, drill down on one of the months.

The Sales by Customer Detail report shows January – December 20XX.

81 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

CERTIFICATION Q&A PRACTICE TEST Certification Q&A multiple-choice questions are available within Connect. For this chapter, the certification practice test is mapped to these QuickBooks Online Certified User exam objectives: List Management, Sales/Money-in, Purchases/Money-Out, Basic Accounting, Reports, Customization/Saving Time. Refer to QBO Certified User_Exam Objectives.pdf

FILES EXPORTED TO EXCEL AND SAVED AS PDF FILES

Chapter/ Exercise 6

Excel & PDF

Page

Chapter 6_Journal

244

Chapter 6_Trial Balance

245

Chapter 6_Sales Tax Liability Report

246

Chapter 6_Customer Balance Summary

246

Chapter 6_AR Aging Summary

247

Chapter 6_Inventory Valuation Summary

247

Chapter 6_Vendor Balance Summary

248

Chapter 6_AP Aging Summary

248

Chapter 6_Profit and Loss

249

Chapter 6_Profit and Loss by Month

251

Chapter 6_Balance Sheet

252

Chapter 6_Custom Balance Sheet

253

Chapter 6_Statement of Cash Flows

254

6-1

Exercise 6-1_December 31 Reconciliation Report

260

6-2

Exercise 6-2_Journal

260

82 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Exercise 6-2_Transaction Detail by Account

260

Exercise 6-2_General Ledger

260

Exercise 6-2_Trial Balance

260

Exercise 6-2_Sales Tax Liability Report

260

Exercise 6-2_Profit and Loss

260

Exercise 6-2_Profit and Loss by Month

260

Exercise 6-2_Balance Sheet

260

Exercise 6-2_Custom Balance Sheet

260

Exercise 6-2_Statement of Cash Flows

260

Links to both the Chapter files and Exercise files are listed in alphabetic order. Scroll down to see the both Chapter file names and Exercise file names.

83 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Chapter 6 Excel file names.

Scroll down to see Exercises 6-1 and 6-2 file names.

For access to the Instructor Resources, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 7 DATA ANALYSIS AND REPORTS – END OF FOURTH QUARTER AND YEAR INSTRUCTOR’S MANUAL

OBJECTIVES

63.

64.

65.

66.

67.

Start QuickBooks Online and sign in to Student Name Sales and Service.

To check data, display the Dashboards graphs and the December 31 Trial Balance.

Record sales tax payments and end-of-quarter adjusting entries.

Display the adjusting journal entries, adjusted trial balance, and financial statements.

Complete the closing process and display the postclosing trial balance.

84

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

68. Understand QBO’s Application Programming Interface to identify how accounting tasks are organized and interrelated.

69. Export reports to Excel and save as PDF files.

70. Complete Check Your Progress and QuickBooks Resources and Activities.

71. Complete Exercises 7-1, 7-2, 7-3, and the Certification Q&A practice test.

In Chapter 7, your students continue recording financial information for Student Name Sales and Service. They complete transactions for the end of the fourth quarter and the end of the year. At the end of December, which is also the end of the fourth quarter, they prepare adjusting entries, print financial statements, and close the fiscal year. QBO’s design, and how accounting tasks are completed, is shown on its Application Programming Interface diagram (Figure 7-23 in the textbook).

QBO Tips  

Students should compare their Dashboards with textbook Figures 7-1, 7-2, 7-3 and 7-4.

Use the Journal Entry screen to enter end-of-fourth-quarter adjusting entries.



Select



The end-of-quarter adjusting entries include:

> Journal Entry (in the Other list) for the Journal Entry screen.

o Adjust three months prepaid rent: $2,000 X 3 = $6,000. o Adjust three months prepaid insurance: $3,000 X 3/12 = $750. o Use straight-line depreciation for computer equipment: $10,000 - $400 (salvage value) ÷ 3 years X 3/12 = $800.

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

33. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercises 7-1 and 7-2.  Exercise 7-3: Problem Solving.

34. Analysis Questions.

35. Quizzes.

36. Test Bank.

37. Certification Q&A questions.

85 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

38. Additional student resources (ASR).

Additional Student Resources (ASR)

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

14. Narrated PowerPoints.

15. QBO Videos. The PowerPoints include links to the videos.

a. b. c. d. e. f. g. h. i.

Paying your sales tax Using list reports Running and customizing reports Intuit QuickBooks channel Video center Learn about QBO with how-to-videos In the know video series Training videos Webinars and events

16. Text Updates.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

To access Connect and Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWER TO ANALYSIS QUESTION, CHAPTER 7: The Chapter 7 Analysis Question is included within Connect. Also, shown below.

Explain the difference between the adjusted trial balance and the postclosing trial balance.

ANSWER: 86 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

After the adjusting entries are recorded on December 31, the adjusted trial balance shows all the general ledger accounts with balances. The adjusted trial balance includes permanent and temporary account balances. Once the adjusting entries are journalized and posted, the adjusted trial balance updates the account balances for Prepaid Insurance and Prepaid Rent, and shows account balance for Accumulated Depreciation, Insurance expense, Rent or Lease expense, and Depreciation expense.

After the fiscal year is closed, and the Net Income amount is transferred to Retained Earnings, a postclosing trial balance is printed on January 1 of the next year. Only permanent accounts appear on the postclosing trial balance. All temporary accounts (income, cost of goods sold, and expenses) have been closed and zeroed out.

MULTIPLE-CHOICE QUESTIONS

The multiple-choice quizzes are within Connect. Also shown below.

11. The purpose of an adjusting entry is: Z. Revenue was earned but not recorded.

AA. Expenses incurred but not recorded.

BB. To show the prepaid expense for one month.

CC. Customer paid in advance of receiving goods or services.

E. All of these.

12. To display the Adjusted Trial Balance in Chapter 7, make these selections: N. Reports > Profit and Loss.

B. Gear > Account and settings.

C. Reports > Trial Balance > from 10/1/XX to 12/31/XX. D. Adjusting entries are rarely recorded for a company.

E. None of these.

3. ____________ are recorded to correct account balances.

87 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Q. Cost of Goods Sold.

R. Balance Sheet.

C. Invoices and Received Payments.

D. Adjusting entries.

E. None of these.

4. On January 1, the Profit & Loss statement shows the following account balances:

Z. The same as on December 31 of the previous year.

AA. Zero.

BB. The same as the Balance Sheet accounts.

CC. The same as the Statement of Cash Flows accounts.

DD. None of these.

5. The Exercise 6-2 December trial balance shows account balances before:

Z. Recording expenses.

AA. Adjustments.

BB. Additional Common Stock investment.

CC. Before bills are paid.

DD. None of these.

6. Record adjusting entries on the:

Z. Customer payments screen.

AA. Vendor payments screen.

BB. Check screen.

CC. Journal Entry screen.

DD. None of these.

7. When depreciating Computer Equipment, this method was used:

Z. Double-declining balance.

88 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

AA. Computer Equipment is not depreciated.

BB. Straight-Line.

CC. Average.

DD. None of these.

8. This report lists each account on the chart of accounts with a minus sign in front of credit balances.

K. December 31 Journal.

L. Adjusted Trial Balance.

M. EOY Profit and Loss statement.

N. Transaction Detail by Account.

O. All of these.

9. After adjustments are journalized and posted, the report(s) updated is/are:

Z. Adjusted Trial Balance.

AA. Profit and Loss.

BB. Balance Sheet.

CC. Statement of Cash Flows.

DD. All of these.

10. In Chapter 7, when the Balance Sheet date is changed to January 1: z. The Balance Sheet has zero account balances. aa. Net Income is shown as Retained Earnings. bb. Depreciation expense has an $800.00 balance. cc. The Balance Sheet is the same on December 31 and January 1. dd. None of these.

True or False:

11. In Chapter 7, end-of-fourth quarter closing entries are recorded on the Journal Entry screen.

False. (In Chapter 7, end-of-fourth quarter adjusting entries are recorded on the Journal Entry screen. The closing process is completed when the Balance Sheet’s date is changed to January 1 of the next year, the Retained Earnings account shows the previous year’s Net Income, and the Profit and Loss accounts have zero balances.

89 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

12. After completing closing entries, you print the Postclosing Trial Balance.

True.

13. The fiscal year is a period that a company uses for accounting purposes and preparing financial statements.

True.

14. For tax purposes, the fiscal year and calendar year are the same because that is the Internal Revenue Service default.

False. For tax purposes, companies can choose to be calendar-year taxpayers or fiscal-year taxpayers. The default IRS system is based on the calendar year.

15. Adjusting entries are recorded to correct an account balance.

True.

16. An example of an adjusting entry is an expense that has been prepaid but it has not been recorded for its appropriate monthly amount.

True.

17. A typical reason for an adjusting entry is that it involves deleting an asset, a liability, or an expense account balance.

False. A typical reason for an adjusting entry is that it involves updating one Profit and Loss statement account and one Balance Sheet account.

18. Accumulated depreciation has a credit balance.

True.

90 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

19. The end of December is also the end of the fourth quarter.

True.

20. The amount shown in Retained Earnings is last year’s Net Income.

True.

ANSWERS TO CHECK YOUR PROGRESS, CHAPTER 7

In Chapter 7, students complete the Check Your Progress assignment. Also, included within Connect.

3.

What is the account balance on 1/1/20XY (next year) in these accounts? Indicate whether these accounts have debit (dr.) or credit (cr.) balances.

Account 101 Checking 53,468.52 (dr.)

Account 105 Accounts Receivable

425.00 (dr.)

Account 115 Merchandise Inventory 9,870.00 (dr.)

Account 123 Prepaid Rent 0.00 (dr.)

Account 125 Prepaid Insurance 2,250.00 (dr.)

Account 137 Accumulated Depreciation 800.00 (cr.)

Account 603 Bank Charges 0.00 (dr.)

91 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Account 318 Retained Earnings 7,093.52 (cr)

2.

What are total current assets?

3. What are total liabilities and equity?

66,013.52

75,213.52

4. What is the amount owed by customers?

425.00

5. List customer name(s) and due dates that payments are owed to Student Name Sales and Service.

Springfield Unified School District, $425.00. The due date is 1/23/20XY.

6. What is the amount owed by Student Name Sales and Service to vendors?

$3,120.00

7. List the vendors’ names, amounts due, and due dates.

AmpleStore Inc., $480, 1/4/20XY and 1/9/20XY Any Time Deployment, $250, 1/17/20XY CloudZ Channel, $800, 1/2/20XY Computers 2 You, $1,500, 1/16/20XY Conf/Call, $90, 1/5/20XY

The total is $3,120 owed to vendors which agrees with #6.

8. How does the Application Programming Interface (API) diagram describe QuickBooks Online’s system? Specify the three ways.

The API diagram shows QBO’s processes and modules and how accounting tasks are organized and interrelated. The API shows these three QBO operations:

a.

Money-in Transactions: Invoice, Sales Receipt, Credit Memo, Estimate, Payment, Refund Receipt; 92

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

b. c.

QBO’s modules: Customer (Accounts Receivable), Vendor (Accounts Payable), Item (Inventory), and Account (Journal Entry, Transfer); Money-out Transactions: Bill, Bill Payment, Purchase, Purchase Order, Vendor Credit.

EXERCISE 7-1: Exercise 7-1 is available within Connect.

Match the Report Description with the Report Name. Students write the appropriate letter next to the Report Name column. Exercise 7-1 is available within Connect.

Write Letter Letter a.

Report Description Summarizes key information, for example, quantity on hand, value, and average cost of each item.

a., b., etc.

f.

Report Name Expenses by Vendor Summary

b.

Groups purchases by the items in the Product/Service List.

h.

Sales by Customer summary

c.

Allows you to see all activity and transactions related to each customer.

n.

Deposit Detail

d.

Breaks down every transaction into debits and credits and displays them chronologically.

g.

Transaction List by Vendor

continued

93 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

e.

Lists individual sales, including dates, types, amounts, and totals.

j.

Check Detail

f.

This report shows total expenses for each vendor.

i.

Trial Balance

g.

Lists all transactions so you can view the company’s activities with a specific vendor.

e.

Sales by Customer Detail

h.

This report shows which customers generated the most revenue.

m.

Account Listing

i.

Summarizes debit and credit balances for each account.

d.

Journal

j.

Provides detailed information about each check issued.

b.

Purchases by Product/Service Detail

k.

Shows money earned and money spent so you can see if you have a profit or loss. Also called the income statement.

o.

Balance Sheet

l.

Transactions modified within the last 4 days.

c.

Transaction List by Customer

m.

Provides the name, type, and balance for each account listing in your chart of accounts.

a.

Inventory Valuation Summary

n.

Provides detailed information about amounts received, including date, client or vendor, and amount.

l.

Recent Transactions

o.

Lists the permanent accounts: assets, liabilities, and equity.

k.

Profit and Loss

94 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

EXERCISE 7-2

Students save reports as PDF files and export reports to Excel.

Exercise 7-3, Problem Solving: Exercise 7-3 Problem Solving is available within Connect. In Connect, student responses are auto-graded. The questions and answers are also shown below.

1. Explain why the amounts are different when the Trial Balance on Figure 7-4 is compared to the Adjusted Trial Balance on Figure 7-7.

On Figure 7-4, the December 31 trial balance, was displayed before adjustments were entered in the journal. This is also Exercise 6-2’s trial balance. On Figure 7-7, amounts were filtered so that zero amounts are not shown. The adjusted trial balance shows all debit and credit balances, including the accounts that were adjusted, including the sales tax payments.

2. What are the differences on the Profit and Loss after adjustments to the P&L saved in Exercise 6-2?

Account

P&L

P&L

after Adjustments

before Adjustments

607 Depreciation Expense

800.00 (Dr.)

0.00

611 Insurance Expense

750.00 (Dr.)

0.00

623 Rent & Lease

6,000.00 (Dr.

0.00

Adjusting Entries Total

7,550.00

Net Income before adjusting entries $14,643.52 Minus adjusting entries total -7,550.00 Net Income after adjustments $7,093.52 On the P&L statement, the total amount of journalized and posted adjusting entries equals the difference between the Net Income before adjustments and Net Income after adjustments.

95 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

CERTIFICATION Q&A PRACTICE TEST: Certification Q&A multiple-choice questions are available within Connect. For this chapter, the certification practice test is mapped to the QuickBooks Online Certified User exam objectives: QuickBooks Online Administration, Sales and Money In, Vendors and Money Out, Basic Reports and Views. Refer to QBO Certified User_Exam Objectives.pdf.

FILES EXPORTED TO EXCEL AND SAVED AS PDF FILES

The chart shows the Excel and PDF files saved in Chapter 7 and Exercise 7-2.

Chapter/ Exercise 7

7-2

Excel and PDF

Page

Chapter 7_December 31Adjusting Journal Entries

269

Chapter 7_December 31 Transaction Detail by Account

269

Chapter 7_Adjusted Trial Balance

270

Chapter 7_EOY Profit and Loss

272

Chapter 7_EOY Balance Sheet

275-276

Chapter 7_EOY Statement of Cash Flows

277

Chapter 7_January 1 Balance Sheet

278

Chapter 7_Postclosing Trial Balance

280

Exercise 7-2_AR Aging Summary

285

Exercise 7-2_Customer Balance Detail

285

Exercise 7-2_Invoice List

285

Exercise 7-2_AP Aging Summary

285

Exercise 7-2_Vendor Balance Detail

285

96 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Exercise 7-2_Unpaid Bills

285

Links to both the Chapter files and Exercise files are listed in alphabetic order. Scroll down to see both Chapter file names and Exercise file names. For access to the Instructor Resources > Excel Reports and PDF Reports, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 8 JANUARY SOURCE DOCUMENTS INSTRUCTOR’S MANUAL

OBJECTIVES

72.

73.

74.

75.

76.

77.

78.

79.

Start QuickBooks Online and sign in to Student Name Sales and Service.

To check data, display the Dashboards graphs and the January 1 20XY Postclosing Trial Balance.

Analyze source documents.

Record vendor, customer, cash and credit card transactions, and sales tax.

Export reports to Excel and save as PDF files.

Complete Check Your Progress.

Review and complete the QuickBooks Resources and Activities.

Complete Exercises 8-1, 8-2, 8-3, and Certification Q&A practice test.

Using source documents, students complete January business transactions for Student Name Sales and Service. The company sells computers, data storage, network products, web servers, and webinars.

The source documents shown prompt transaction analysis for issuing checks for expenses, accounts payable (vendors), inventory, accounts receivable (customers), and cash and credit card sales. Students also use the January 31 bank statement to reconcile Account 101 Checking.

QBO Tips 

Using source documents, students record transaction. o Memo shown for Vendor payments: Vendors > select appropriate vendor > open bill > Make payment.

97

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

o Transaction register: Create (+) > Check (within the vendor list) > make appropriate selection > within Account details, select expense. o Credit card receipts: Create (+) > Sales Receipt (within the Customers list) > select appropriate type of credit card > complete items.

98 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

o Customer payments: Customers > select appropriate customer, open invoice > Receive payment. o Bill: Create (+) > Bill (within the Vendors list) > select appropriate vendor. o Sales Invoice: Create (+) > Invoice (within Customers list) > select appropriate customer. o Sales Receipts for cash sales: Create (+) > Sales Receipt > select cash sales. o Bank statement for checking account reconciliation.

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

39. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercises 81 and 8-2.  Exercise 8-3: Problem Solving.

40. Analysis Questions.

41. Quizzes.

42. Test Bank.

43. Certification Q&A questions.

44. Additional student resources (ASR).

Additional Student Resources (ASR)

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

17. Narrated PowerPoints.

18. QBO Videos. The PowerPoints include links to the videos.

a. b. c. d. e. f. g. h. i.

How to connect your bank & credit card Recurring invoices and using autopay Using the cash flow planner Intuit QuickBooks channel Video center Learn about QBO with how-to-videos In the know video series Training videos Webinars and events 99

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

j. View all help 19. Text Updates.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

To access Connect and Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWER TO ANALYSIS QUESTIONS, CHAPTER 8: The Chapter 8 Analysis Questions are included within Connect. Also, shown below.

1.

How do you determine when to use Sales Receipts or Sales Invoices?

ANSWER:

Depending on when you receive the payments, there are two ways to deal with sales transactions:

a.

For sales to a customer on account, or deferred payment, create invoices and receive payments against them.

b.

For an immediate cash or credit card payment, use sales receipts.

2. How do you record a Sales Invoice?

ANSWER:

Choose + New > Invoice to create the invoice.

3. How do you record a Sales Receipt?

ANSWER: 100 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Choose + New > Sales Receipt create the sales receipt.

MULTIPLE-CHOICE QUESTIONS

The multiple-choice quizzes are within Connect. Also shown below.

13. To make sure you are starting in the correct place in the data, display the: DD. January journal.

EE. Adjusted Trial Balance.

FF. January 1 Trial Balance.

GG. December 1-31 Balance Sheet.

HH.None of these 14. In Chapter 8, all transactions occur in the month of: O. November.

B. December.

C. January.

D. October.

E. None of these.

3. If you recorded fourth-quarter transactions in 2021, January transactions are recorded for:

S. 2019.

T. 2020 C. 2021.

D. 2022.

E. None of these.

4. Transactions are reported as __________ the moment you save them with QBO. 101 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

EE. Posted.

FF. Bills to vendors.

GG. Sales invoices.

HH. Sales receipts.

II. None of these.

5. Make this selection to record credit card receipts:

EE. Bills (in vendor list).

FF. Sales receipt (in customers list).

GG. Reports (from the Navigation bar).

HH. Company settings (from Gear icon).

II. None of these.

6. Customer payments are recorded on this screen:

EE. Sales Invoice.

FF. Bill Payment GG. Register.

HH. Receive Payment.

II. None of these.

7. To purchase inventory, record the transaction from this source document:

EE. Sales Receipt.

FF. Vendor Payment.

GG. Memo.

HH.

Bill.

II. All of these.

8. To show sales on account to customers, analyze this source document:

P. Bill.

Q. Memo.

102 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

R. Sales Receipt.

S. Sales Invoice.

T. All of these.

103 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

9. Cash sales are recorded on this screen:

EE. Bill Payment.

FF. Accounts Receivable register.

GG. Sales Receipt.

HH. Sales Invoice.

II. None of these.

10. Viewing the checking account’s bank register includes:

ee. All the transactions for that account. ff. History of the account. gg. Checking account balance. hh. Reconciled transactions. ii. All of these.

True or False:

11. The postclosing trial balance and January 1 trial balance show the same account balances.

True.

12. In Chapter 8, a memo, followed by remittances, shows which vendor payments need to be made.

True.

13. Refer to the Sales Invoice source document for the products sold and credit cards used.

False. Refer to the Sales Receipts source document for the products sold and credit cards used.

14. When a Bill is received, the customer shown is Student Name Sales and Service.

True.

15. In Chapter 8, use the same year as the one used in Chapter 7.

104 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

False. In Chapter 8, use the year following the one used in Chapter 7.

16. On the Receive payment screen, use the Reference No. field for the check number.

True.

17.

Credit card sales are deposited to Account 105 Accounts Receivable.

False. Credit card sales are deposited to Account 101 Checking.

18.

On January 1, Account 318 Retained Earnings has a credit balance.

True.

19.

Select gear to create a sales form like an invoice or expense.

False. Select + New to create a sales form like an invoice or expense.

20.

The bank sends Student Name Sales and Service verification of credit card sales.

True.

CHECK YOUR PROGRESS, CHAPTER 8

In Chapter 8, students complete the Check Your Progress assignment. Also, included within Connect.

4.

What is the account balance from 1/1/20XY to 1/30/20XY in these accounts? Indicate whether these accounts have debit (dr.) or credit (cr.) balances.

Account 101 Checking

$48,995.20 (dr.)

105 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Account 105 Accounts Receivable (dr.)

$1,615.87

Account 115 Merchandise Inventory $11,575.00 (dr.)

Account 201 Accounts Payable

$3,500.00

(cr.)

Account 207 Arizona Department of Revenue Payable

$471.53 (cr.)

Account 208 Illinois Department of Revenue Payable

$25.00 (cr.)

Net Income $3,546.02

Total Liabilities and Equity $79,636.07

2. What is the quantity, asset value, and average cost of computers?

13, $6,500, $500

3. What is the quantity, asset value, and average cost of data storage?

55, $825, $15

4.

What is the quantity, asset value, and average cost of network products?

32, $800, $25

5. What is the quantity, asset value, and average cost of web servers?

15, $3,000, $200

6. What is the quantity, asset value, and average cost of webinars?

10, $450, $45 106 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

7. Where on the Dashboards is the balance in the checking account? What is the account number, date, and balance?

The Dashboards show the checking account balance in the BANK ACCOUNTS area.

Account number:

101 Checking

Date:

1/30/20XY

Balance:

$48,995.20

EXERCISE 8-1

Using the January 31 bank statement shown in the textbook, reconcile Account 101 Checking.

EXERCISE 8-2

Students save reports as PDF files and export reports to Excel.

EXERCISE 8-3, Problem Solving: Exercise 8-3 Problem Solving is available within Connect. In Connect, student responses are auto-graded. The questions and answers are also shown below.

Describe the difference between a Bill and Invoice. Include an example, which QBO module is being used, and the account distribution for a Bill and an Invoice.

ANSWER:

107 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

The accounts payable module includes vendor bills. Student Name Sales and Service purchases items on account from vendors. Bills are money that Student Name Sales and Service owes to the companies they buy items from.

The account distribution for a vendor bill is:

The accounts receivable module includes customer invoices for items sold. Customers owe money to Student Name Sales and Service for items bought on account.

The account distribution for a customer invoice is:

CERTIFICATION Q&A Practice Test: Certification Q&A multiple-choice questions are available within Connect.

Certification Q&A multiple-choice questions are available within Connect. For this chapter, the certification practice test is mapped to these QuickBooks Online Certified User exam objectives: QuickBooks Online Administration, Sales and Money In, Vendors and Money Out, Basic Reports and Views. Open the QBO Certified User_Exam Objectives.pdf file.

FILES EXPORTED TO EXCEL AND SAVED AS PDFS IN CHAPTER 8

108 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

The chart below shows the Excel files and PDF files saved in Chapter 8 and Exercise 8-2.

Chapter/ Exercise

Excel & PDF

Page

Chapter 8_Journal

322

Chapter 8_Trial Balance

322

Chapter 8_AR Aging Summary

323

Chapter 8_Inventory Valuation Summary

323

Chapter 8_AP Aging Summary

324

Chapter 8_Profit and Loss

324

Chapter 8_Balance Sheet

325

Chapter 8_Statement of Cash Flows

326

8-1

Exercise 8-1_Reconciliation Report

330

8-2

Exercise 8-2_Journal

330

Exercise 8-2_Transaction Detail by Account

330

Exercise 8-2_General Ledger

330

Exercise 8-2_Customer Balance Summary

330

Exercise 8-2_Vendor Balance Summary

330

Exercise 8-2_Sales Tax Liability Report

330

Exercise 8-2_Trial Balance

330

Exercise 8-2_Profit and Loss

330

Exercise 8-2_Balance Sheet

330

Exercise 8-2_Statement of Cash Flows

330

8

8-2

109 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Links to both the Chapter files and Exercise files are listed in alphabetic order. Scroll down to see both Chapter file names and Exercise file names. For access to the Instructor Resources > Excel Reports and PDF Reports, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 9 FEBRUARY SOURCE DOCUMENTS INSTRUCTOR’S MANUAL

OBJECTIVES

80. Start QuickBooks Online and sign in to Student Name Sales and Service.

81. To check data, display the Dashboards invoices, money-in and money-out reports, and the January 31 Trial Balance.

82. Analyze source documents.

83. Record vendor, customer, cash and credit card transactions, and sales tax.

84. Export reports to Excel and save as PDF files.

85. Complete Check Your Progress.

86. Review and complete the QuickBooks Resources and Activities.

87. Complete Exercises 9-1, 9-2, 9-3, and the Certification Q&A practice test.

The purpose of Chapter 9 is to review what students have learned in the previous chapters. Students analyze source documents, then record transactions. The documents prompt transaction analysis for accounts payable (vendors), inventory, accounts receivable (customers), cash and credit card sales.

Using the February 28 bank statement, students reconcile Account 101 Checking.

QBO Tips 

Source documents include:     

Vendor bills for purchasing inventory.

Memos include customer payments, vendor payments and remittances.

Transaction register for issuing checks for expenses and recording ATM withdrawals.

Sales invoices for credit customers.

Sales receipts for cash and credit card sales.

110 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

45. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercises 9-1 and 9-2.  Exercise 9-3: Problem Solving.

46. Analysis Questions.

47. Quizzes.

48. Test Bank.

49. Certification Q&A questions.

50. Additional student resources (ASR).

Additional Student Resources (ASR) The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

20. Narrated PowerPoints.

21. Videos:

a. b. c. d. e. f. g.

Connect to Square Intuit QuickBooks channel Learn about QBO with how-to-videos In the know video series Training videos Webinars and events View all help

22. Text Updates.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

To access Connect and Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

111 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

ANSWER TO ANALYSIS QUESTIONS, CHAPTER 9: The Chapter 9 Analysis Question is included within Connect. Also, shown below.

1. On the Check number screen, what icon is used to display checks issued? What does the Check number screen show?

ANSWER: To display what checks are issued, click on the Clock icon. Check number screen verifies the Transaction Register’s check numbers, expense amounts, and balance.

2. On the Vendors screen, how do you make payments?

ANSWER:

Link to a vendor that shows an open balance > click Make payment.

MULTIPLE-CHOICE QUESTIONS

The multiple-choice quizzes are within Connect. Also shown below.

15. To make sure you are starting in the correct place in the data, display the: JJ. January 1-31 Trial Balance.

KK. Adjusted Trial Balance.

LL. February Trial Balance.

MM.

December 1-31 Balance Sheet.

NN. None of these.

16. In Chapter 9, all transactions occur in the month of: P. November.

B. October.

C. December.

D. January.

112 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

E. None of these.

113 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

3. Credit card receipts are entered on this screen:

U. Invoice.

V. Make vendor payment.

C. Bill.

D. Sales Receipt.

E. None of these.

4. Use this report to display the accounts receivable balance:

U. Accounts Payable Aging Summary.

V. Inventory Valuation Summary.

W. Account 101 Checking Register.

X. Accounts Receivable Aging Summary.

Y. None of these.

5. The Dashboards display the same Checking account balance (as of a specific date) as the:

JJ. Accounts Payable Aging Summary.

KK. Transaction Register.

LL. Inventory Valuation Summary.

MM. Accounts Receivable Aging Summary.

NN. None of these.

6. The Sales Tax rate on credit card sales is:

JJ. Zero.

KK. 5%.

LL. 6.25%.

MM. 6.10%.

NN. None of these.

114 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

7. Payments from customers are due within:

A. 30 days.

B. 15 days.

C. 45 days.

D. 60 days.

E. None of these.

8. The total amount owed to vendor is the same amount as: A. Account 101, Checking.

B. Transaction Register balance.

C. Account 115, Merchandise Inventory.

D. Account 201, Accounts Payable E. All of these.

9. Asset values and average costs are shown on this report:

JJ. Accounts Receivable Aging Summary.

KK. Inventory Valuation Summary.

LL. Trial Balance.

MM. Journal.

NN. None of these.

10. Net income is shown on the following reports:

jj. Profit and Loss, Balance Sheet, Statement of Cash Flows. kk. Profit and Loss and Inventory Valuation Summary. ll. Balance Sheet and Accounts Payable Aging Summary. mm.

Accounts Payable Aging Summary and Accounts Receivable Aging Summary. nn. All of these.

115 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

True or False:

11. Refer to the transaction register for entering ATMs and checks for expenses.

True.

12. Memos include vendor payments, remittances, and customer payments.

True.

13. Use sales invoices for purchasing inventory.

False. Use vendor bills for purchasing inventory.

14. The Profit and Loss shows Cost of Goods Sold.

True.

15. The Balance Sheet’s Net Income amount is also shown on the Trial Balance.

False. The Net Income amount is shown on these reports: Profit and Loss, Balance Sheet, and Statement of Cash Flows.

16. Each credit card receipt is from the same credit card company.

False. Credit card receipts are from different credit card companies.

17. Deposit customer payments into Account 101 Checking.

True.

18. When a check is issued, Account 201 Accounts Payable is credited.

False. When a check is issued, Account 101 Checking is credited.

116 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

19. The January 31 Trial Balance shows non-zero or active accounts only.

True.

20. To verify the accounts receivable balance, display one of the inventory reports.

False. To verify the accounts receivable balance, display the Accounts Receivable Aging Summary or Customer Balance Summary.

CHECK YOUR PROGRESS, CHAPTER 9

In Chapter 9, students complete the Check Your Progress assignment. Also, included within Connect.

5.

What is the account balance from 1/1/20XY to 2/27/20XY in these accounts? Indicate whether these accounts have debit (dr.) or credit (cr.) balances.

Account 101 Checking

$49,064.90 (dr.)

Account 135 Computer Equipment

$10,000.00 (dr.)

Account 137 Accumulated Depreciation $800.00 (cr.)

Account 207 Arizona Department of Revenue Payable $977.83 (cr.)

Account 208 Illinois Department of Revenue Payable $50.00 (cr.)

Account 401 Sales $17,790.00 (cr.)

Account 501 Cost of Goods Sold

$8,895.00 (dr.)

117 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

2. What is the Net Income? $6,994.42

`

3. What are the total Liabilities and Equity?

$79,250.77

4. What is the quantity, asset value, and average cost of computers?

12, $6,000, $500

5. What is the quantity, asset value, and average cost of data storage?

56, $840.00, $15

6. What is the quantity, asset value, and average cost of network products.

18, $450, $25

7. What is the quantity, asset value, and average cost of web servers?

16, $3,200, $200

8. What is the quantity, asset value, and average cost of webinars?

14, $630, $45

9. What is the sequence of steps from the Navigation bar’s Cash flow selection to display customer payment due dates?

118 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Overview > Money in > Open invoices row > Create invoice > View invoices 10. What report shows customer payment due dates?

Customer Balance Detail

119 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

11. What is the sequence of steps from the Navigation bar’s Cash Flow selection to display bill due dates?

Overview > Money out > View reports > Unpaid bills EXERCISE 9-1

Using the February 28 bank statement shown in the textbook, reconcile Account 101 Checking.

EXERCISE 9-2

Students save reports as PDF files and export reports to Excel.

EXERCISE 9-3, Problem Solving: Exercise 9-3 Problem Solving is available within Connect. The questions and answers are also shown below.

1. What is a module?

ANSWER:

A module is a software design that emphasizes separating the functions of a program into independent, interchangeable components, so that each contains everything necessary to execute one aspect of the desired function. For example, QBO organizes transactions and reports by modules or components within the accounting system.

2. Organize the following source documents according to the QBO modules used. Define each module.

ANSWER:

120 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.



Bills and vendor payments: Accounts Payable module

Accounts payable is the amount of money the business owes to vendors. Accounts payable organizes and monitors both purchases on account and vendor payments. The accounts payable module is used when purchases are made on account and receives payments from vendors.

 Invoices and customer payments: Accounts Receivable module Accounts receivable are what customers owe your business. The accounts receivable module organizes both sales on account and customer payments. When Student Name Sales and Service sells items on account and receives payments from customers, the accounts receivable module is used.

Certification Q&A Practice Test Certification Q&A multiple-choice questions are available within Connect. For this chapter, the certification practice test is mapped to these exam objectives: QuickBooks Online Administration, Sales and Money In, Vendors and Money Out, Basic Reports and Views. Refer to QBO Certified User_Exam Objectives.pdf.

FILES EXPORTED TO EXCEL AND SAVED AS PDFS IN CHAPTER 9

The chart below shows the PDF and Excel files saved in Chapter 9 and Exercises 9-1 and 9-2.

Chapter/ Exercise

9

PDF & Excel

Page

Chapter 9_Journal

364

Chapter 9_Trial Balance

365

Chapter 9_AR Aging Summary

366

Chapter 9_Inventory Valuation Summary

367

Chapter 9_AP Aging Summary

367 121

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Chapter 9_Profit and Loss

367

Chapter 9_Balance Sheet

368

Chapter 9_Statement of Cash Flows

369

9-1

Exercise 9-1_Reconciliation Report.pdf

373

9-2

Exercise 9-2_Journal

373

Exercise 9-2_Transaction Detail by Account

373

Exercise 9-2_General Ledger

373

Exercise 9-2_Customer Balance Summary

373

Exercise 9-2_Vendor Balance Summary

373

Exercise 9-2_Sales Tax Liability Report

373

Exercise 9-2_Trial Balance

373

Exercise 9-2_Profit and Loss

373

Exercise 9-2_Balance Sheet

373

Exercise 9-2_Statement of Cash Flows

373

9-2

Links to both the Chapter files and Exercise files are listed in alphabetic order. Scroll down to see both Chapter file names and Exercise file names. For access to the Instructor Resources > Excel Reports and PDF Reports, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html CHAPTER 10 MARCH SOURCE DOCUMENTS AND END OF FIRST QUARTER INSTRUCTOR’S MANUAL

OBJECTIVES

88. Start QuickBooks Online and sign in to Student Name Sales and Service.

122 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

89. To check data, display invoice status, customer balances, money out reports, and the February 28 Trial Balance.

90. Analyze source documents.

91. Record vendor, customer, cash, and credit card transactions, and sales tax.

92. Record end-of-quarter adjusting entries.

93. Display the adjusted trial balance and financial statements.

94. Export reports to Excel and save as PDF files.

95. Complete Check Your Progress.

96. Review and complete the QuickBooks Resources and Activities.

97. Complete Exercises 10-1, 10-2, 10-3, and the Certification Q&A practice test.

In Chapter 10, your students complete business processes for Student Name Sales and Service. The company sells computers, data storage, network products, web servers, webinars, and purchases inventory on account from vendors. In order to record transactions, students analyze source documents.

To reconcile Account 101 Checking, students use Exercise 10-1’s March 31 bank statement

At the end of the first quarter, sales tax payments, adjusting entries and financial statements are completed.

QBO Tips   

It is the policy of Student Name Sales and Service to record adjusting entries at the end of the quarter. The accounting records are complete through March 31, 20XY. At the end of the first quarter, sales tax payments, adjusting entries and financial statements are completed.

Students could refer to Chapter 7’s end-of-quarter adjusting entries to review the accounts and the amounts debited and credited.

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

51. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercises 10-1 and 10-2.  Exercise 10-3: Problem Solving.

52. Analysis Questions.

53. Quizzes.

123 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

54. Test Bank.

55. Certification Q&A questions.

56. Additional student resources (ASR).

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

23. Narrated PowerPoints.

24. Videos: a. b. c. d. e. f.

Capture & manage receipts Manage billing & subscription Intuit QuickBooks channel Video center Learn about QBO with how-to-videos Training videos

g. Webinars and events h. View all help 25. Text Updates.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

To access Connect and Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

124 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

ANSWER TO ANALYSIS QUESTIONS, CHAPTER 10

The Chapter 10 Analysis Questions are included within Connect. Also, shown below.

1. Why does the March 31, 20XY Balance Sheet show both Retained Earnings and Net Income?

ANSWER:

The Retained Earnings balance reflects last year’s Net Income. When the Balance Sheet was printed for January 1 of the next year, the Net Income amount on the December 31 Profit and Loss statement was transferred to Retained Earnings.

The Net Income amount on the March 31 Balance Sheet is the same as the amount shown on the Profit and Loss Statement – Sales minus Expenses and Cost of Goods Sold.

2. What section of the Balance Sheet are the Retained Earnings and Net Income amounts shown?

ANSWER: The Equity section of the balance sheet lists Account 318 Retained Earnings and the Net Income amount.

MULTIPLE-CHOICE QUESTIONS

The multiple-choice quizzes are within Connect. Also shown below.

17. The date for the end of the first quarter is: OO. December 31.

PP. January 31.

QQ. February 29.

RR. March 31.

SS. None of these.

18. The source document for ordering inventory is: 125 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Q. Memo.

B. Sales Receipt.

C. Transaction Register.

D. Bill.

E. None of these.

3. The source document that shows sales to customers on account is a:

W. Transaction Register.

X. Sales Invoice.

C. Sales Receipt.

D. Bill.

E. None of these.

4. To make sure you are starting Chapter 10 in the correct place in the data, display:

JJ. Customer payments for March.

KK. Money in.

LL. Money out.

MM.

January 1 through February 28 Trial Balance.

NN. All of these.

5. In Chapter 10, all transactions occurred in:

OO. February.

PP. March.

QQ. April.

RR. May. SS. None of these.

126 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

6. This type of transaction includes a field for selecting the credit card used.

OO. Sales Invoices.

PP. Memo.

QQ. Bill.

RR. Sales Receipt.

SS. All of these.

7. To confirm amounts owed to Illinois and Arizona, display this report.

F. March 31 Journal.

G. AR Aging Summary.

H. Sales Tax Liability Report.

I. Profit and Loss by Month.

J.

None of these.

8. The following report is printed before the end-of-the-quarter transactions are journalized and posted:

Z. Profit and Loss.

AA. Balance Sheet.

BB. Adjusted Trial Balance.

CC. Unadjusted Trial Balance DD. All of these.

9. After recording the adjusting entry for rent paid on January 1, Account 123 Prepaid Rent has this balance.

OO. $6,000.00.

PP. $0.00.

QQ. $1,500.00.

RR. $53,493.52.

SS. None of these

127 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

10. To adjust depreciation, debit and credit the following accounts:

oo. Debit Accumulated Depreciation, Credit Depreciation Expense. pp. Debit Computer Equipment, Credit Accumulated Depreciation. qq. Debit Depreciation Expense, Credit Accumulated Depreciation. rr. Debit Depreciation Expense, Credit Computer Equipment. ss. None of these.

True or False:

11. The first quarter is October, November, and December.

False. The first quarter is January, February and March.

12. The March 1 Trial Balance shows the same account balances the February 28 trial balance.

True.

13. The bank sends verification of credit card receipts.

True.

14. The source document analysis sequence is Analyze source document, Enter date, Input transaction.

True.

15. The A/P Aging Summary shows the same balance Account 105 Accounts Receivable.

False. The A/P Aging Summary shows the same balance as Account 201 Accounts Payable.

The A/R Aging Summary shows the same balance as Account 105 Accounts Receivable.

128 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

16. The Inventory Valuation Summary shows the same balance as Account 115 Merchandise Inventory.

True.

17. In Chapter 10, the trial balance does not show a balance for Account 318 Retained Earnings.

False. The balance in Account 318 Retained Earnings is shown on the Chapter 10 trial balances.

18. Net Income is determined by subtracting total Expenses from the Gross Profit amount.

True.

19. In Chapter 10, Student Name Sales and Service received all customer payments due.

False. In Chapter 10, customers paid some but not all amounts due for sales on account.

20. The account type for Account 101 Checking is Bank.

True.

CHECK YOUR PROGRESS, CHAPTER 10

In Chapter 10, students complete the Check Your Progress assignment. Also, included within Connect.

6.

What is the account balance from 1/1/20XY to 3/31/20XY in these accounts? Indicate whether these accounts have debit (dr.) or credit (cr.) balances.

Account 101 Checking $55,143.57 (dr.)

129 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Account 115 Merchandise Inventory

$10,030.00 (dr.)

Account 123 Prepaid Rent

$0.00 (dr.)

Account 207 Arizona Department of Revenue Payable $0.00 (cr.)

Account 208 Illinois Department of Revenue Payable $0.00 (cr.)

Account 401 Sales $30,650.00 (cr.)

Net Income $4,866.41

Total Assets $77,299.93

2. What accounts are debited and credited for the prepaid rent adjustment? Indicate the account type.

Debit, Account 623 Rent or Lease (Expenses). Credit, Account 123 Prepaid Rent (Other current asset).

3. What is the amount of the adjusting entry for prepaid rent?

$6,000.00

4. What accounts are debited and credited for the prepaid insurance adjustment? Indicate the account type.

Debit, Account 611 Insurance Expense (Expenses). Credit, Account 125 Prepaid Insurance (Other current asset).

5. What is the amount of the adjustment entry for prepaid insurance?

$750.00

130 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

6. What accounts are debited and credited for the depreciation adjustment? Indicate the account type.

Debit, Account 607 Depreciation Expense (Expenses). Credit, Account 137 Accumulated Depreciation (Fixed Assets).

7. What is the amount of the adjustment for depreciation?

$800.00

EXERCISE 10-1

Using the March 31 bank statement shown in the textbook, reconcile Account 101 Checking.

EXERCISE 10-2

Students save reports as PDF files and export reports to Excel.

EXERCISE 10-3: PROBLEM SOLVING: Exercise 10-3 Problem Solving is available within Connect. The questions and answers are also shown below.

1. What are the similarities and differences between the Transaction Detail by Account and the General Ledger?

ANSWER: The Transaction Detail by Account report lists subtotals by each account on your chart of accounts. It is like the General ledger without opening balances.

The General Ledger shows each account in your chart of account. The GL shows all the transactions that occurred in that account over a period of time. It includes the beginning balance and total for each account.

2. Why does the Profit and Loss by Month report, Figure 10-22, show a Net Loss for March 20XY? Show the calculation.

ANSWER: 131 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

In March, expenses exceeded total income and total cost of goods sold resulting in a loss of $2,108.01.

Total Income: Total Cost of Goods Sold Total Expenses Net Loss

$12,860.00 -6,430.00 -8,538.01 -2,108.01

3. Why do the Total Assets and Total Liabilities and Equity balance within the Exercise 10-2 Balance Sheet differ from the March 31 Balance Sheet shown on Figure 10-23? Show the calculation.

ANSWER: When the Balance Sheet on Figure 10-23 is compared to the Exercise 10-2 Balance Sheet, Account 101 Checking and Net Income is different. Account 101 Checking and Net Income differs because the March 31 account reconciliation has not been completed.

Net Income, Figure 10-23 Net income, Exercise 10-2 Difference

$4,866.41 4,846.41 -20.00

In Exercise 10-2, the $20 Bank Service Charge reduced Account 101 Checking.

Account 101 Checking, Figure 10-23 Account 101, Exercise 10-2 Difference

$55,143.57 55,123.57 -20.00

The checking account balance affects Total Assets; the Net Income balance affects Total Liabilities and Equity.

132 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Certification Q&A Practice Test Certification Q&A multiple-choice questions are available within Connect. For this chapter, the certification practice test is mapped to these exam objectives: QuickBooks Online Administration, Sales and Money In, Vendors and Money Out, Basic Reports and Views. Refer to QBO Certified User_Exam Objectives.pdf.

FILES EXPORTED TO EXCEL AND SAVED AS PDF FILES IN CHAPTER 10

Chapter/ Exercise 10

Excel & PDF

Page

Chapter 10_Unadjusted Trial Balance

409

Chapter 10_Sales Tax Liability Report

410

Chapter 10_Journal

415

Chapter 10_March 31 Adjusting Journal Entries

415

Chapter 10_Adjusted Trial Balance

416

Chapter 10_AR Aging Summary

417

Chapter 10_Inventory Valuation Summary

417

Chapter 10_AP Aging Summary

418

Chapter 10_Profit and Loss

419

Chapter 10_Profit and Loss by Month

420

Chapter 10_Balance Sheet

421

Chapter 10_Statement of Cash Flows

422

10-1

Exercise 10-1_Reconciliation Report.pdf

426

10-2

Exercise 10-2_Journal

426

Exercise 10-2_Trial Balance

426 133

© McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Exercise 10-2_Transaction Detail by Account

426

Exercise 10-2_General Ledger

426

Exercise 10-2_Customer Balance Summary

426

Exercise 10-2_Vendor Balance Summary

426

Exercise 10-2_Profit and Loss

426

Exercise 10-2_Balance Sheet

426

Exercise 10-2_Statement of Cash Flows

426

Links to both the Chapter files and Exercise files are listed. For access to the Instructor Resources, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 11 EMPLOYEES AND PAYROLL INSTRUCTOR’S MANAUL

OBJECTIVES

1.

2.

3.

4.

5.

6.

7.

8.

Use QBO’s 30-day free Core Payroll app.

Add Employee information.

Complete paychecks and reports.

Check the payroll app’s subscription.

Export reports to Excel and save PDF files.

Complete Check Your Progress.

Review and complete the QuickBooks Resources and Activities.

Complete Exercises 11-1, 11-2, 11-3, and Certification Q&A practice test.

Chapter 11 focuses on these areas:

 The payroll app.

134 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

 Employee information.  Recording employee payroll.  Reports.

Use QBO’s free 30-day Core payroll app. In this chapter students add an employee to Student Name Sales and Service. After 30 days the payroll app expires.

NOTE: QBO updates can change the payroll app. Regularly check Additional Student Text Updates. The figures and screen captures shown in Chapter 11 are for example purposes. Students’ dates will differ.

QBO Tips 

The Core payroll app defaults to the current date. Students’ month/day/year will differ from the textbook figures and screen illustrations.



The look of QBO’s payroll selections and screens may change. Regularly check Additional Student Resources > Text Updates.

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

57. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercises 11-1 and 11-2.  Exercise 11-3: Problem Solving.

58. Analysis Questions.

59. Quizzes.

60. Test Bank.

61. Certification Q&A questions.

62. Additional student resources (ASR).

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

26. Narrated PowerPoints.

135 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

27. QBO Videos: a. b. c. d. e.

Entering payroll tax info Payroll form filing Paying payroll taxes File W-2s and 1099s View all help

28. Text Updates.

136 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

To access Connect, Additional Student Resources, and Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWER TO ANALYSIS QUESTIONS, CHAPTER 11

The Chapter 11 Analysis Questions are included within Connect. Also, shown below.

3. What is Core payroll app time limit?

30 days 4. During payroll setup, the following employee information is needed. 

    

Completed federal and state W-4 Form. Form W-4 provides the employer with the employee’s withholding information, pay rate and schedule, hire dates, and, if used, direct deposit information.

Pay rate: hourly, salary, commission, etc.

Paycheck Deductions: 401(k), insurance, garnishments.

Sick/Vacation Policies.

Direct Deposit Information: required only if you are paying any employee by direct deposit.

Important Dates: hire, birth, term.

MULTIPLE-CHOICE QUESTIONS: The multiple-choice quizzes are within Connect.

19.

For setting up payroll, this company information is needed: TT. Company Federal Employer Identification number.

UU. Types of employee compensation, for example, hourly, salary, commissions, tips.

VV. Type of employee benefits, for example, health insurance, union dues, etc.

WW.

Employee’s date of birth.

XX. All of these.

137 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

20.

Tax information includes: R. State Unemployment Insurance and state agency ID. B. State assessments, surcharge, training tax rates, signed quarterly state and federal filings.

D. Schedule for tax deposits and filing and tax payment information.

E. All of these.

3. To verify employment eligibility in the United States, this form is used:

Y. W-2.

Z. I-9.

C. Federal Form 944.

D. All. E. None of these.

4. This form shows the amount of federal income tax, Social Security, and Medicare withheld from paychecks for the quarter.

OO. Federal Form 940.

PP. Form W-3.

QQ. Federal Form 944.

RR. Federal Form 941.

SS. None of these.

5. What state is Student Name Sales and Service located in?

TT. Alaska.

UU. Arizona.

VV. California.

WW. Pennsylvania.

XX. None of these.

138 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

6. Who is your payroll contact?

TT. Professor’s first and last name.

UU. Employee in the payroll department.

VV. Accountant.

WW. Student’s first and last name.

XX. None of these.

7. The employee added in Chapter 11 is paid on what day of the week?

K. Tuesday.

L. Wednesday.

M. Thursday.

N. Friday.

O. None of these.

8. What type of compensation does the employee added in Chapter 11 receive?

EE. Salary.

FF. Commission.

GG. Tips.

HH. Hourly.

II. None of these.

9. The detail type for Account 212, Payroll Liabilities is:

TT. Other current liabilities.

UU. Payroll tax payable.

VV. Payroll expenses.

WW. Current assets.

XX. None of these.

10.

Display the __________________________to see Mr. McClure’s net pay.

139 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

tt. W-2. uu. Paycheck. vv. For I-9. ww.

Statement of Cash Flows. xx. All of these.

True or False: The True or False questions are within Connect.

11. In Chapter 11, you issue three paychecks.

False. In Chapter 11, you issue four paychecks.

12. The Core payroll app does not expire.

False. The payroll app is for free 30 days only.

13. If you notice changes to QBO’s interface, go to the text updates link on the Online Learning Center.

True.

14. The Arizona Department of Revenue issues the State Agency ID. True.

15. The payroll app defaults to the current date.

True.

16. Paydays include 40 hours of work during a week that start on Monday and end on Friday.

True.

17. An employee’s federal filing status is entered on a W-2 form.

False. An employee’s federal filing status is entered on a W-4 form.

140 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

141 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

18. For a Federal Employer Identification Number (FEIN), a unique ID is issues by the IRS only.

False. Federal Employer Identification Number (FEIN) number is issued by the IRS and state agencies.

19. Before submitting payroll, select Preview payroll.

True.

20. Once payroll is set up and an employee is added, QBO automatically creates accounts for payroll liabilities and expenses.

True.

CHECK YOUR PROGRESS, CHAPTER 11

In Chapter 11, students complete the Check Your Progress assignment. Also included within Connect.

1. What form provides an employer with the employee’s withholding information? Include the name (title) of the form.

Form W-4, Employee’s Withholding Certificate

2.

What form summarizes the employer’s Federal Income Tax, Social Security, and Medicare withheld from employee’s paychecks for the year. Include the name (title) of the form.

Federal Form 944, Employer’s Annual Federal Tax Report.

3.

List five types of employee compensation?

Hourly, salary, bonuses, commissions, and tips

142 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

4. What form needs to be sent to each employee by January 31? Include the name (title) of the form.

Form W-2, Wage and Tax Statement

5.

Where do you file Form W-3, Transmittal of Wage and Tax Statement? What does form W-3 include?

File Form W-3 with the Social Security Administration. It shows a summary of the employer’s W-2 forms.

6.

What is Form I-9?

Form I-9, Employment Eligibility Verification, is used to verify employment eligibility in the United States.

EXERCISE 11-1

Issue paychecks to Brice McClure for the third and fourth weeks in April 20XY.

EXERCISE 11-2

Students export reports to Excel and save PDF files.

EXERCISE 11-3: PROBLEM SOLVING: Exercise 11-3 Problem Solving is available within Connect. The questions and answers are also shown below.

What is the default pay date for paychecks? How does QBO determine the pay period? Explain.

Friday is the default pay date for paychecks. Depending on the month and year, the date range starts on the Saturday before the Friday pay date. For example, in 2020, the period begins Saturday 04/04/2020 and ending Friday 04/10/2020. The pay date is Friday, 4/10/2020.

Certification Q&A Practice Test: The Certification Q&A multiple-choice questions are available within Connect.

EXCEL & PDF FILES SAVED IN CHAPTER 11 143 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

The chart below shows the Excel and PDF files saved in Chapter 11 and Exercise 11-2.

Chapter/ Exercise 11

11-2

PDF & Excel

Page

Chapter 11_Journal

443

Chapter 11_Paycheck 1118.pdf

445

Exercise 11-2_Journal

447

Exercise 11-2_Paycheck History.pdf

447

Links to both the Chapter files and Exercise files are listed. For access to the Instructor Resources, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

CHAPTER 12 CERTIFICATION, APPS, AND UPDATES INSTRUCTOR’S MANUAL OBJECTIVES

9. Learn about QuickBooks Online User Certification and the textbook chapters that coordinate with the certification test.

10. Go online to QuickBooks Apps, the QuickBooks blog, and learn about updates.

11. Complete Check Your Progress.

12. Review and complete the QuickBooks Resources and Activities.

13. Complete Exercises 12-1, 12-2, 12-3 and Certification Q&A practice test.

Chapter 12 focuses on these areas:

144 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

 QuickBooks Online Certification chart includes exam objectives and chapter map.  QBO App store.  Blog and updates.

QBO Tips   

Chapter 12 includes a chart showing certification exam objectives and which chapters cover certification topics.

The company that manages QBO Certification is Certiport, www.certiport.com. Certiport is a thirdparty vendor. There is a charge for the certification test.

Apps help QuickBooks run better.  Updates are included on the What’s new QuickBooks Blog.

QUICKBOOKS RESOURCES AND ACTIVITIES

Connect: One or more of the following may be assigned for auto-grading and feedback.

63. Assignable In-Chapter and End of Chapter Material.  Check Your Progress.  Exercises 12-1 and 12-2.  Exercise 12-3: Problem Solving.

64. Analysis Questions.

65. Quizzes.

66. Test Bank.

67. Certification Q&A questions.

68. Additional student resources (ASR).

The following resources can be found on the ASR page in Connect’s eBook. If students are not using Connect, the professor provides students with a URL to access the ASR page.

29. Narrated PowerPoints.

30. QBO Videos: a. How to Use the QuickBooks Mobile App b. In the know video series c. Learn about QBO with how-to-videos d. Training videos e. Webinars and events f. Intuit QuickBooks channel g. Intuit Assist and Generative AI h. View all help 145 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

31. Text Updates.

INSTRUCTOR RESOURCES AND ADDITIONAL STUDENT RESOURCES

To access Additional Student Resources, Connect and Instructor’s Resources, contact the school’s McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

ANSWER TO ANALYSIS QUESTIONS, CHAPTER 12

The Chapter 12 Analysis Questions are included within Connect. Also, shown below.

5.

QuickBooks Online Administration includes:

a. b. c. d. e.

6.

Setting up a company.

Managing lists and journal entries.

Management recurring transactions.

Connecting to apps.

All of these.

Use Apps to: a. b. c. d. e.

Expand the capabilities of QuickBooks Online.

Export reports to Excel and save as PDF files.

Go to the Dashboards metrics.

Change Account and settings.

None of these.

MULTIPLE-CHOICE QUESTIONS: The multiple-choice quizzes are within Connect.

21. Students can confirm their QBO knowledge by passing the:

146 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

YY. Test administered the second week of class.

ZZ. Saving reports.

AAA. Customizing reports.

BBB. Certification test.

CCC. None of these.

22.

Managing lists for a QuickBooks Online company is included in this certification objective: S. Bank accounts, transaction rules, and receipts.

B. Sales and money in.

C. QuickBooks Online Administration.

D. Vendors and money out.

E. None of these.

3. Sales and money in include:

AA. Setting up customers BB. Setting up products and services.

C. Managing sales settings.

D. Recording basic money-in transactions.

E. All of these.

4. Vendors and money-out includes the following except:

TT. Managing vendor records.

UU. Managing expense settings.

VV. Recording and managing basic money-out transactions.

WW. Recording and managing basic money-in transactions.

XX. None of these.

5. Basic reports and views include:

YY. Describing the content and purpose of reports.

147 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

ZZ. Customizing standard reports.

AAA. Delivering standard reports BBB. Accessing other reports and views.

CCC. All of these.

6. Bank accounts, transaction rules, and receipts includes all of the following except:

YY. Implementing financial account co ZZ. Managing bank feeds.

AAA. Managing receipts.

BBB. Connecting QBO to apps.

CCC. None of these.

7. ___________________ describes a combination of productivity, automated accounting, and hasslefree security.

P. Q. R. S. T.

Perpetual inventory.

Cash sales.

Scalability.

Invoices.

None of these.

8. QuickBooks Online automatically backs up data to the:

JJ. Hard drive.

KK. Local installation directory.

LL. Account and settings.

MM. Cloud.

NN. All of these.

9. The reason to use a Mobile apps is to:

YY. Access accounting reports on the go.

ZZ. Work anywhere.

AAA. Accept payments.

BBB. Email invoices.

148 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

CCC.

All to these.

10. The QuickBooks Blog includes:

yy. Customized reports. zz. Vendor lists. aaa.

What’s new. bbb.

Customer information. ccc. None of these.

True or False: The True or False questions are within Connect.

11. The Certification test covers how to customize reports.

True.

12. For the Certification test, student should know how to connect QBO to apps.

True.

13. QuickBooks apps may change over time.

True.

14. Mobile apps can only be used on an iPhone.

False. Mobile apps can be installed on Android and iOS devices.

15. The QBO mobile app is free with a paid-for QBO subscription.

True.

16. Apps are included for every business type.

True.

149 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

17. The Blog’s What’s New selection includes several links.

True.

18. Money-in includes accounts payable transactions.

False. Money-in transactions include cash sales and accounts receivable transactions.

19. Money-out includes accounts payable transactions.

True.

20. QBO can process credit cards with Intuit’s card reader.

True.

150 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

CHECK YOUR PROGRESS, CHAPTER 12

In Chapter 12, students complete the Check Your Progress assignment. Also included within Connect.

1. What third-party vendor manages the QBO certification test?

Certiport

2. What is the website address of the company that manages QBO certification?

www.certiport.com

4. What PDF file includes detailed information about the certification test?

QBO Certified User_Exam Objectives.pdf

4. What is the QuickBooks App store’s website address?

https://quickbooks.intuit.com/app/apps/home

7. Why use Mobile Apps?

Expand the capabilities of QuickBooks Online with apps. Apps are included for every business type.

EXERCISE 12-1

1.

Sales and Money in includes these tasks.

151 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

Set up customers Set up products and services Manage sales settings Record basic money-in transactions

2.

Vendors and Money out includes these tasks.

Manage vendor records Manage expense settings Record and manage basic money-out transactions

3.

Basic reports and views include these tasks.

Describe the content and purpose of reports Customize and deliver standard reports Access other reports and views.

EXERCISE 12-2: For these answers, use the Apps website at https://quickbooks.intuit.com/app/apps/home

Select three App collections: Collections Categories Industries

Select five App categories: Manage sales Manage workforce Get paid Get customers Manage data Student answers may vary. These categories are available: 152 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.

EXERCISE 12-3: PROBLEM SOLVING:

Compare Sales and Money-in tasks to Vendor Money-out tasks.

Sales and Money-in tasks involve cash and credit customers. This includes sales receipts, invoice transactions, and customer payments.

Vendor and Money-out tasks involve vendors and expenses. This includes checks, bills, and vendor payments.

Certification Q&A Practice Test: Certification Q&A multiple-choice questions are available within Connect.

For access to the Instructor Resources, professors should contact their McGraw-Hill Learning Technology Representative at https://shop.mheducation.com/store/paris/user/findltr.html.

153 © McGraw Hill LLC. All rights reserved. No reproduction or distribution without the prior written consent of McGraw Hill LLC.