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After the success of the company s first two months, Santana Rey continues to operate Business Solutions. The November 3 0 , 2 0 2
After the success of the companys first two months, Santana Rey continues to operate Business Solutions. The November unadjusted trial balance of Business Solutions reflecting its transactions for October and November of follows.
Number Account Title Debit Credit
Cash $
Accounts receivable
Computer supplies
Prepaid insurance
Prepaid rent
Office equipment
Accumulated depreciationOffice equipment $
Computer equipment
Accumulated depreciationComputer equipment
Accounts payable
Wages payable
Unearned computer services revenue
Common stock
Retained earnings
Dividends
Computer services revenue
Depreciation expenseOffice equipment
Depreciation expenseComputer equipment
Wages expense
Insurance expense
Rent expense
Computer supplies expense
Advertising expense
Mileage expense
Miscellaneous expenses
Repairs expenseComputer
Income summary
Totals $ $
Business Solutions had the following transactions and events in December
December Paid $ cash to Hillside Mall for Business Solutions's share of mall advertising costs.
December Paid $ cash for minor repairs to the companys computer.
December Received $ cash from Alexs Engineering Company for the receivable from November.
December Paid cash to Lyn Addie for six days of work at the rate of $ per day.
December Notified by Alexs Engineering Company that Business Solutions's bid of $ on a proposed project has been accepted. Alexs paid a $ cash advance to Business Solutions.
December Purchased $ of computer supplies on credit from Harris Office Products.
December Sent a reminder to Gomez Company to pay the fee for services recorded on November
December Completed a project for Liu Corporation and received $ cash.
December Took the week off for the holidays.
December Received $ cash from Gomez Company on its receivable.
December Reimbursed S Rey for business automobile mileage miles at $ per mile
December Paid $ cash for dividends.
The following additional facts are collected for use in making adjusting entries prior to preparing financial statements for the companys first three months.
The December inventory count of computer supplies shows $ still available.
Three months have expired since the month insurance premium was paid in advance.
As of December Lyn Addie has not been paid for four days of work at $ per day.
The computer system, acquired on October is expected to have a fouryear life with no salvage value.
The office equipment, acquired on October is expected to have a fiveyear life with no salvage value.
Three of the four months' prepaid rent have expired.
Required:
Prepare journal entries to record each of the December transactions. Post those entries to the accounts in the ledger.
a Prepare adjusting entries to reflect a through f
b Post the journal entries to record each of the December transactions, adjusting entries to the accounts in the ledger.
Prepare an adjusted trial balance as of December
Prepare an income statement for the three months ended December
Prepare a statement of retained earnings for the three months ended December
Prepare a classified balance sheet as of December
Record the necessary closing entries as of December
Prepare a postclosing trial balance as of December
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