Creating and Journalizing Accounting Transactions
Professor Ionie Pierce
Business
Principles of Accounting 1
Activity Description: Provide a brief description of the activity
Create a service company and integrate what you have learned in class:
Create transactions for your company, include different types of transactions
Journalize your transactions
Post the accounts to the ledger
Prepare unadjusted trial balance
Create and journalize adjustments
Prepare adjusted trial balance
Prepare financial statements
Prepare closing entries
Prepare post-closing trial balance.
You will be asked to present your work to the class
Learning Goals: What do you aim to achieve with this activity?
– Develop a clear understanding of the accounting cycle, from initial journal entry to the preparation of financial statements.
– Build skills to prepare accurate and complete financial records, ensuring compliance with accounting principles.
– Understand how accounting entries affect the overall financial health of an organization and the preparation of financial reports.
– Gain the ability to communicate financial data effectively, using proper accounting terminology and methods.
Timing: At what point in the lesson or semester do you use this activity? How much classroom time do you devote to it? How much out-of-class time is expected?
The activity is done towards the end of the semester. Seeing that the goal of the activity is to test students' knowledge of their understanding of what they learn, not much in-class activity is done unless students have questions. Students are expected to devote as much out-of-class time as required to complete the project. After completion, students will do a presentation.
Logistics: What preparation is needed for this activity? What instructions do you give students? Is the activity low-stakes, high-stakes, or something else?
To effectively perform the activities of journalizing, posting, adjusting entries, and closing entries in accounting, adequate preparation is crucial. The preparation needed for each task are:
1. In preparation for writing journal entries, students must understand the transaction. They must analyze each business transaction thoroughly to determine which accounts are affected and whether they should be debited or credited. And whether the transaction involves an asset, liability, equity, revenue, or expense account, as each has different rules for debiting and crediting.
2. In preparation for journalizing entries, the general ledger must be set up and it must be organized with individual accounts for each asset, liability, equity, revenue, and expense category. The debit and credit amounts for each journal entry, as well as the accounts involved must be double-check, to make sure that everything balances correctly.
3. In preparation for posting entries you have to make sure you know how to transfer amounts from the journal to the ledger while maintaining the correct debit/credit balance. And all journal entries must be posted to the ledger in a timely manner to ensure that the trial balance is accurate and up to date.
4. In preparation for adjusting entries you must look at the current trial balance to identify accounts that may require adjustments for example, accounts like prepaid expenses, unearned revenue, accrued expenses. And make sure you can differentiate between accruals, which are revenues and expenses that have been earned/incurred but not yet recorded and deferrals which are transactions where money was received or paid in advance of actual recognition.
5. In preparation for closing entries, temporary accounts need to be identified, because temporary accounts need to be closed at the end of the accounting period. These typically include revenues, expenses, and drawings/dividends accounts. Revenue accounts such as sales, service revenue, etc., and expense accounts such as salaries, utilities, etc. need to be transferred to an income summary account. And understand how the net income or loss from the income summary will affect the retained earnings account. Then transfer dividends/drawings, if applicable to retained earnings/Owner's Equity. After performing closing entries, you must confirm that the temporary accounts which are revenues, expenses, dividends/drawings have been reduced to zero, and the balances have been transferred to retained earnings/owner's equity.
The activity is high-stakes because it is used as a major component of the final grade, in which students' performance is critically evaluated.
Assessment: How do you assess this activity? What assessment measures do you use? Do you use a VALUE rubric? If not, how did you develop your rubric? Is your course part of the college-wide general education assessment initiative?
The VALUE Rubric helps to assess general education outcomes. It is structured to assess student work on a range of criteria using levels of performance. The VALUE Rubric can be adapted to evaluate accounting tasks, especially in areas like critical thinking, problem-solving, and quantitative literacy. The VALUE rubrics in accounting activities include
Criteria for Assessment and Levels of Performance. The criteria for assessment includes Knowledge of Accounting Concepts, Problem Solving, Application of Skills, and Accuracy of Work. The Levels of Performance includes Capstone/Excellent, Milestones /Proficient, Benchmark/Basic and Beginning/Needs Improvement.
I am not aware that the course is part of the college-wide general education assessment initiative.
Reflection: How well did this activity work in your classroom? Would you repeat it? Why or why not? What challenges did you encounter, and how did you address them? What, if anything, would you change? What did students seem to enjoy about the activity?
This activity works well in my class. Students were able to do the work and present it with knowledge that they have grasp the concepts taught in class. Yes, I will repeat this in my class next semester because it helps to reinforce the concepts taught. I did not encounter any challenge. What students need clarification on, I explained it to them. Students did well, therefore, I would not make any changes. Students were able to prepare their work and present it so they were glad they understand the concepts not only to put it on paper, but also to present it.
Additional Information: Please share any additional comments and further documentation of the activity – e.g. assignment instructions, rubrics, examples of student work, etc. These can be links to pages or posts on the OpenLab.
Have example of a rubric but do not know how to attach it or create a link.
Please share a helpful link to a pages or post on the OpenLab



