After the success of the company's first two months, Santana Sam's continues to operate Business Solutions. The November 30, 2017, unadjusted trial balance of Business Solutions (reflecting its transactions for October and November of 2017) follows.

Account Title:

101 Cash$38,564

106 Accounts receivable13,218

126 Computer supplies2,545

128 Prepaid insurance1,920

131 Prepaid rent3,280

163 Office equipment8,500

164 Accumulated depreciationOffice equipment$0

167 Computer equipment20,800

168 Accumulated depreciationComputer equipment0

201 Accounts payable0

210 Wages payable0

236 Unearned computer services revenue0

301 S. Rey, Capital70,000302S. Rey, Withdrawals6,300

403 Computer services revenue30,824

612 Depreciation expenseOffice equipment0

613 Depreciation expenseComputer equipment0

623 Wages expense2,450

637 Insurance expense0

640 Rent expense0

652 Computer supplies expense0

655 Advertising expense1,718

676 Mileage expense614

677 Miscellaneous expenses190

684 Repairs expenseComputer725

Totals$100,824$100,824

Dec.2Paid $1,000 cash to Hillside Mall for Business Solutions' share of mall advertising costs.

3Paid $460 cash for minor repairs to the company's computer.

4Received $4,350 cash from Alex's Engineering Co. for the receivable from November.

10Paid cash to Lyn Addie for six days of work at the rate of $110 per day.

14Notified by Alex's Engineering Co. that Business Solutions' bid of $7,700 on a proposed project has been accepted. Alex's paid a $2,300 cash advance to Business Solutions.

15Purchased $1,100 of computer supplies on credit from Harris Office Products.

16Sent a reminder to Gomez Co. to pay the fee for services recorded on November 8.

20Completed a project for Liu Corporation and received $6,225 cash.

22Took the week off for the holidays.

26

28Received $3,300 cash from Gomez Co. on its receivable.

29Reimbursed S. Rey for business automobile mileage (500 miles at $0.28 per mile).

31S. Rey withdrew $1,400 cash from the company for personal use.

The following additional facts are collected for use in making adjusting entries prior to preparing financial statements for the company's first three months:

A- The December 31 inventory count of computer supplies shows $630 still available.

B- Three months have expired since the 12-month insurance premium was paid in advance.

C- As of December 31, Lyn Addie has not been paid for four days of work at $110 per day.

D- The computer system, acquired on October 1, is expected to have a four-year life with no salvage value.

E- The office equipment, acquired on October 1, is expected to have a five-year life with no salvage value.

F- Three of the four months' prepaid rent has expired.

Required:

1.Prepare journal entries to record each of the December transactions and events for Business Solutions.

2-a.adjusting entries to reflect a through f.

2-b.Post the journal entries to record each of the December transactions, adjusting entries to the accounts in the ledger.

3.adjusted trial balance as of December 31, 2017.

4.income statement for the three months ended December 31, 2017.

5.statement of owner's equity for the three months ended December 31, 2017.

6.balance sheet as of December 31, 2017.