Week 3 — From Journal to Trial Balance: Recording the Shop's Month 1 — Traditional alternative (no AI)

Instructors: publish this instead of the adaptive version if you prefer, and unpublish or delete the adaptive one.

Assignment 3 of the term — journalize the bicycle shop's first month, post it to the ledger, prepare and test its trial balance, and explain to a founder what the balanced totals do and do not prove.

This week you learned how accountants record what happens: the account and the T-account, debit and credit, normal balances, double-entry bookkeeping, the journal, posting, the general ledger, and the trial balance with its limits. In Week 1 you met the people outside the business who rely on its records; in Week 2 you analyzed these transactions in the accounting equation. This week's lecture tutorial, quiz, discussion, and Accounting Workshop practice the same moves from other angles; this assignment is where you put them together.

The task

Your material is Dataset A, the running case (illustrative): an unnamed bicycle repair and sales shop, organized as a corporation by two founders, and its 12 transactions in Month 1. It describes no real business. You analyzed these same events in the accounting equation in Week 2; this week you record them the way an accountant does.

• Transaction 1, Day 1: the founders invest $30,000 cash in exchange for 30,000 shares of common stock.
• Transaction 2, Day 2: the shop pays $12,000 cash for repair equipment.
• Transaction 3, Day 3: the shop buys $900 of shop supplies on account.
• Transaction 4, Day 4: the shop pays $2,400 for a 12-month insurance policy that begins on Day 1.
• Transaction 5, Day 6: a cycling club pays $1,200 in advance for a season of group tune-ups the shop has not yet performed.
• Transaction 6, Day 15: the shop performs repair services for walk-in customers and collects $3,500 cash.
• Transaction 7, Day 18: the shop performs $1,800 of repair services for a delivery company on account.
• Transaction 8, Day 20: the shop pays $1,500 rent for the month.
• Transaction 9, Day 22: the shop pays $600 of the $900 it owes for supplies.
• Transaction 10, Day 25: the shop collects $1,000 from the delivery company on its account.
• Transaction 11, Day 28: the shop pays $1,600 wages to its part-time mechanic.
• Transaction 12, Day 30: the shop pays a $500 cash dividend to its shareholders.

Part A — journalize and post.

1. Write a journal entry for each of the 12 transactions in the course layout: the transaction number and day, the debited account first and flush left with its amount, the credited account indented with its amount, and a one-line explanation. Check that every entry's debits equal its credits. Use a list or plain lines, not a table.

2. Post every entry to a T-account, writing each amount on the same side as in the journal with its transaction number beside it. Write each T-account as two short lists labelled Left (debits) and Right (credits).

3. Work this problem, showing your sums and your subtraction:

   In Dataset A, the bicycle shop's Cash account receives debits of 30,000, 1,200, 3,500, and 1,000 dollars and credits of 12,000, 2,400, 1,500, 600, 1,600, and 500 dollars in Month 1. What is the Cash balance, in dollars?

4. Give the balance of every other account and say which side it sits on. Check each balance against the account's normal balance.

Part B — prepare and test the trial balance.

1. List all 12 accounts in an unadjusted trial balance, each balance in a debit column or a credit column. Then work this problem, showing your addition:

   In Dataset A, the bicycle shop's unadjusted trial balance lists debit balances of 17,100, 800, 900, 2,400, 12,000, 500, 1,500, and 1,600 dollars. What is the total of the debit column, in dollars?

   Foot the credit column the same way and compare the two totals.

2. Test the check. Suppose transaction 9 had never been journalized. Recompute the Cash and Accounts Payable balances and both column totals, and say what the result shows. Then name the three kinds of error a balanced trial balance cannot catch, and one kind it does catch.

Explain it to a non-expert

One of the shop's founders, who has never studied accounting, looks at your trial balance and says, "Both columns say $36,800, so our books must be right." Write a 3–5 sentence message to that founder that explains, in everyday words, what the matching totals do prove and what they do not, using the shop's own figures. Name one error the totals could hide, and explain any term the founder might not know, such as debit or ledger.

For a different, ungraded example, imagine a roommate who says a shared grocery spreadsheet "must be right" because the two columns, money paid in and money spent, agree. Model reply: "The columns agreeing tells us every purchase we typed in was split the same way on both sides, which is a good sign. It doesn't tell us we typed in every purchase. If one of us forgot a receipt, both columns would still agree, because the receipt would be missing from both. So the next step is to check the list against the receipts, not just the totals."

Use that pattern for your founder, with your own explanation.

Reflect on your revision

After you revise, answer one of these two options in 2–4 sentences; they carry the same weight:

• (a) Which entry or balance did you change, and what check showed you it was needed?
• (b) Which of the shop's 12 transactions was hardest to journalize, and what rule settled which side each amount went on?

Revise with a self-audit

Before you submit, audit your first draft against the attached scoring criteria, one criterion at a time: for every entry, name the type of each account and check that its amount sits on the side that makes that type grow; check that every entry's two sides are equal; recompute every T-account's sums and balance; foot both trial balance columns twice; and check your message against the three errors a trial balance cannot catch. Then write a second draft of at least one part, and keep both drafts.

Deliverables

Submit in the assignment entry: the 12 journal entries; the posted T-accounts with the P1 sums and subtraction and every balance; the unadjusted trial balance with the P2 addition and the footed credit column; the transaction 9 test and the list of errors a trial balance cannot catch; your message to the founder; your first and second drafts of the part you revised; and your reflection. Each part may be written, or recorded as audio or video with a transcript; every form is graded by the same scoring criteria.

Submit in any accessible file type or as a link; a recorded response may be submitted as audio or video with a transcript, or as text.

How you'll be graded

The full analytic rubric is attached to this assignment in Canvas.

Academic integrity and AI use

The journal entries, T-accounts, trial balance, test, message, revision, and reflection must be your own work. This version of the assignment asks for no chatbot at any step. Do not invent a rule or a standard; check every one against Chapter 3 and Dataset A above.

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