Mulberry Services sells electronic data processing services to firms too small to own their own computing equipment. Mulberry had the following accounts and account balances as of January 1:

Accounts Payable$14,000Accounts Receivable130,000Cash6,000Common Stock114,000Interest Payable8,000Notes Payable (Long-term)80,000Prepaid Rent (Short-term)96,000Retained Earnings, January 116,000

During the year, the following transactions occurred (the events described below are aggregations of many individual events):

a.During the year, Mulberry sold $690,000 of computing services, all on credit.b.Mulberry collected $570,000 from the credit sales in Transaction a and an additional $129,000 from the accounts receivable outstanding at the beginning of the year.c.Mulberry paid the interest payable of $8,000.d.Wages of $379,000 were paid in cash.e.Repairs and maintenance of $9,000 were incurred and paid.f.The prepaid rent at the beginning of the year was used during the year. In addition, $28,000 of computer rental costs were incurred and paid. There is no prepaid rent or rent payable at year-end.g.Mulberry purchased computer paper for $13,000 cash in late December. None of the paper was used by year-end.h.Advertising expense of $26,000 was incurred and paid.i.Income tax of $10,300 was incurred and paid during the year.j.Interest of $5,000 was paid on the long-term loan.Required:1.Establish a ledger for the accounts listed above and enter the beginning balances.2.Analyze each transaction. Journalize as appropriate.3.Post your journal entries to T-accounts. Add additional T-accounts when needed.4.Use the ending balances in the T-accounts to prepare a trial balance.CHART OF ACCOUNTSMulberry ServicesGeneral LedgerASSETS111Cash121Accounts Receivable122Notes Receivable123Supplies124Prepaid Insurance125Prepaid Rent126Inventory131Land132Buildings133Equipment134Furniture135Trucks139Accumulated DepreciationLIABILITIES211Accounts Payable212Notes Payable213Income Taxes Payable214Wages Payable215Utilities Payable216Insurance Payable217Interest Payable218Rent Payable219Unearned Service Revenue231Bonds PayableEQUITY311Common Stock321Retained Earnings331Dividends

1. The account title for each T-account has been provided. Based on the data provided, enter the applicable beginning balances.

3. Post your journal entries to T-accounts. Add additional T-accounts when needed.

T-Accounts Instructions

CashBeg. Bal. End. Bal.Accounts ReceivableBeg. Bal. End. Bal.Prepaid RentBeg. Bal. End. BalSupplies End. Bal.Accounts PayableBeg. Bal.End. BalInterest Payable Beg. Bal.End. BalNotes PayableBeg. Bal.End. Bal.Common StockBeg. Bal.End. Bal.Retained EarningsBeg. Bal.End. Bal.Service Revenue End. BalRent Expense End. Bal.Advertising Expense End. Bal.Wages Expense End. Bal.Repairs & Maintenance Expense End. Bal.Interest Expense End. Bal.Income Taxes Expense End. Bal