8f9ffc790a2f9eb15227408ff868c735_27149f0e6d2db299fdc37473d7a27306 - ACCT 3312 Project Narrative and Instructions Rockford Corporation is a wholesale

8f9ffc790a2f9eb15227408ff868c735_27149f0e6d2db299fdc37473d7a27306

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ACCT 3312 Project adapted from Rockford Practice Set @Wiley Narrative and Instructions Rockford Corporation is a wholesale plumbing supply distributor. The corporation was organized in 1981, under the laws of the State of Illinois, with an authorized capitalization of 10,000 shares of no-par common stock with a stated value of $30 per share. The common stock is sold over the the counter in the local area. You have been hired as of Thursday, December 25, 2014, to replace the controller, who has resigned. As controller, you are responsible for the corporation's accounting recrods, preparation of the financial statements, safeguarding the corporate assets, and providing management with financial information to set prices and to monitor and control operations. Rockford Corporation closes its books annually on December 31 but prepares financial statements quarterly. Adjusting entries are posted to the general ledger only at year-end; at the end of the first, second, and third quarter the adjustments are entered only on a work sheet, not in the general ledger. Therefore, the adjusting entries to be recorded on December 31 are annual adjustments that you must journalize and the post to the general ledger accounts before preparing the financial statements. Rockford Corporation maintains a perpetual inventory system and takes a physical count each year to adjust the inventory carrying amount. Purchases are recorded at the gross amount (discounts taken are recognized at the date of payment) of the supplier's invoice, and the terms vary with each supplier. Sales on account are subject to terms of 2/10, n/30. Discounts are taken and granted only when the terms are met. The cost of all inventory sold in December was 80% of the sales price. The corporation uses the following journals and ledgers: Journals 1. A sales journal (S) - to record sales of merchandise on account. 2. A purchase journal (P)- to record purchases of merchandise on account. 3. A cash receipts journal (CR) - to record all cash receipts. 4. A cash disbursements journal (CD) - to record all cash payments. 5. A general journal (J) - to record all transacitons that cannot be recorded in the other journals. Ledgers 1. A general ledger 2. An accounts receivable subsidiary ledger. 3. An accounts payable subsidiary ledger. In recording sales transactions, each sale should be posted on the day of the sale directly to the customer's account in the subsidiary ledger, using the invoice number as the posting reference number in the subsidiary account. Also, cash receipts from customers should be posted to the subsidiary ledger on the day they are received. The purchase order number should be used as the posting reference number in the subsidiary ledger for purchases on account from suppliers. Purchases from suppliers and payments to them should be posted daily. All other individual posting may be made weekly or at the month-end. Account numbers should be used as posting reference numbers in the journals. Officers and office personnel are salaried employees and are paid monthly on the last day of each month. The delivery truck drivers and warehouse employees are hourly wage
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