After the success of the companys first two months, Santana Rey 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.

No.	Account Title	Debit			Credit
101	Cash	$	39,064
106	Accounts receivable		12,818
126	Computer supplies		2,645
128	Prepaid insurance		1,920
131	Prepaid rent		3,060
163	Office equipment		8,900
164	Accumulated depreciationOffice equipment				$	0
167	Computer equipment		21,600
168	Accumulated depreciationComputer equipment					0
201	Accounts payable					0
210	Wages payable					0
236	Unearned computer services revenue					0
307	Common stock					69,000
318	Retained earnings					0
319	Dividends		6,500
403	Computer services revenue					33,029
612	Depreciation expenseOffice equipment		0
613	Depreciation expenseComputer equipment		0
623	Wages expense		2,325
637	Insurance expense		0
640	Rent expense		0
652	Computer supplies expense		0
655	Advertising expense		1,638
676	Mileage expense		624
677	Miscellaneous expenses		210
684	Repairs expenseComputer		725
	Totals	$	102,029		$	102,029

Business Solutions had the following transactions and events in December 2017.

Dec.	2		Paid $950 cash to Hillside Mall for Business Solutions share of mall advertising costs.
	3		Paid $420 cash for minor repairs to the companys computer.
	4		Received $4,850 cash from Alexs Engineering Co. for the receivable from November.
	10		Paid cash to Lyn Addie for six days of work at the rate of $105 per day.
	14		Notified by Alexs Engineering Co. that Business Solutions bid of $7,900 on a proposed project has been accepted. Alexs paid a $1,600 cash advance to Business Solutions.
	15		Purchased $2,000 of computer supplies on credit from Harris Office Products.
	16		Sent a reminder to Gomez Co. to pay the fee for services recorded on November 8.
	20		Completed a project for Liu Corporation and received $5,975 cash.
	2226		Took the week off for the holidays.
	28		Received $3,300 cash from Gomez Co. on its receivable.
	29		Reimbursed S. Rey for business automobile mileage (400 miles at $0.23 per mile).
	31		The company paid $1,300 cash in dividends.

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

1. The December 31 inventory count of computer supplies shows $670 still available.
2. Three months have expired since the 12-month insurance premium was paid in advance.
3. As of December 31, Lyn Addie has not been paid for four days of work at $105 per day.
4. The computer system, acquired on October 1, is expected to have a four-year life with no salvage value.
5. The office equipment, acquired on October 1, is expected to have a five-year life with no salvage value.
6. Three of the four months' prepaid rent has expired.

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

• The December 31 inventory count of computer supplies shows $670 still available.

Transaction	General Journal	Debit	Credit
a.	Computer supplies expense
	Computer supplies

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

Transaction	General Journal	Debit	Credit
b.

• As of December 31, Lyn Addie has not been paid for four days of work at $105 per day.

Transaction	General Journal	Debit	Credit
c.

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

Transaction	General Journal	Debit	Credit
d.

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

Transaction	General Journal	Debit	Credit
e.

• Three of the four months prepaid rent has expired.

Transaction	General Journal	Debit	Credit
f.