Santana Rey created Business Solutions on October 1, 2020. The company has been successful, and its list of customers has grown. To accommodate the growth, the accounting system is modified to set up separate accounts for each customer. The following chart of accounts includes the account number used for each account and any balance as of December 31, 2020. Santana Rey decided to add a fourth digit with a decimal point to the 106 account number that had been used for the single Accounts Receivable account. This change allows the company to continue using the existing chart of accounts Credit Debit $48,392 0 0 0 3,100 0 2,828 es 0 0 0 630 1.935 895 8,030 $ 320 167 21,100 No. Account Title 101 Cash 106.1 Alex's Engineering Co. 106.2 Wildcat Services 106.3 Tasy Leasing 106.4 ITM Co. 106.5 Liu Corp. 106.6 Comex Co. 106.7 Delta Co. 106.8 ke, Inc. 106.9 Dream, Ine. 119 Merchandise inventory 126 Computer supplies 120 Prepaid insurance 131 Prepaid rent 163 office equipment 164 Accumulated depreciation office equipment Computer equipment 168 Accumulated depreciation Computer equipment 201 Accounts payablo 210 Wages payable 236 Unearned computer services revenue Common stock 318 Retained earnings 319 Dividends 403 Computer services revenue 413 Sales 414 Sales returns and allowances 415 Sales discounts 502 Cost of goods sold 612 Depreciation expense-office equipment 613 Depreciation expense-Computer equipment 623 Wages expense 637 Insurance expense 640 Rent expense 652 Computer supplies expense 655 Advertising expense 676 Mileage expense 677 Miscellaneous expenses 684 Repairs expense-computer 1,230 1,230 500 1,480 73,890 8,260 307 0 0 0 0 0 0 0 In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 110, n/30, FOB shipping point to all customers who purchase this marchandi on consulting tees. Additional accounts (US, 119, 13.1.10. O the company's new merchandising activities. Its transactions for January through March follow, Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of $125 per day. Four of the five days relate to wagen payable that were accrued in the prior year. 5 Santana Rey invested an additional $24,700 cash in the company in exchange for more common stock. 7 The company purchased $2,500 of merchandise fron Kansas Corp. with term of 1/10, n/30, POB shipping point, invoice dated January 7. 9 The company received $2,028 cash from Gomes Co. a full payment on to account. 11 The company completed a five-day project for Alex's Engineering co. and billed it $5,420, which is the total price of $6,900 loss the advance payment of $1,480. The company debited Unearned Computer Services Revenue for $1,480. 1) The company sold nerchandise with a retail value of $4,500 and a cont of $3,510 to Liu Corp., invoice dated January 1). 15 The company paid $690 cash for freight charges on the merchandise purchased on January 7. 16 The company received $4,170 cash from Delta co. for computer services provided. 17 The company paid Kansas Corp. for the invoice dated January 7, net of the discount. 20 The company gave a price reduction (allowance) of $500 to Liu Corp. and credited Liu's accounts receivable for that amount. 22 The company received the balance due from Liu corp., net of the discount and the allowance. 24 The company returned detective merchandise to Kansas Corp. and accepted a credit against future purchases (debited accounts payable). The defective merchandise invoice cost, net of the discount, was $496. 26 The company purchased $9,500 of merchandise from Kansas Corp. with terns of 1/10, n/30, POB destination, invoice dated January 26. 26 The company sold merchandise with a $4,520 cost for $5,890 on credit to KC, Inc., invoice dated January 26. 31 The company paid cash to Lyn Addie for 10 days work at $125 per day. Teb. The company paid $2,685 cash to Hillside Mall for another three months rent in ad ce. 3 The company paid Kansas Corp. for the balance due, net of the cash discount, less the $496 credit fron merchandise returned on January 24. 5 The company paid $430 cash to Facebook for an advertisement to appear on February 5 only. 11 The company received the balance due from Alex's Engineering Co. for fees billed on January 11. 15 The company paid a $4,700 cash dividend. 23 The company sold merchandise with a $2,470 cost for $3,390 on credit to Delta Co., invoice dated February 23. 26 The company paid cash to Lyn Addie for eight days work at $125 per day. 27 The company reimbursed Santana Rey $192 cash for business automobile mileage. The company recorded the reimbursement as "Mileage Expense." Mar. B. The company purchased $2,840 of computer supplies from Harris office Products on credit with terms of n/30, FOB destination, invoice dated March 8. 9 The company received the balance due from Delta co. for merchandise sold on February 23. 11 The company paid $920 cash for minor repairs to the company's computer. 16 The company received $5,270 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due of $4,070 to Harris office Products, consisting of amounts created on December 15 (of $1,230) and March 8. 24 The company billed Easy Leasing for $9,107 of computing services provided. 25 The company sold merchandise with a $2,112 cost for $2,830 on credit to Wildcat Services, Invoice dated March 25. 30 The company sold merchandise with a $1,098 cost for $2,260 on credit to ITM Company, invoice dated March 30. 31 The company reimbursed Santana Rey $192 cash for business automobile mileage. The company recorded the reimbursement as Mileage Expense. The following additional facts are available for roaring References ar the company reimbursed Santana Rey $192 cash for business automobile mileage. The company recorded the reimbursement as "Mileage Expense. Mar. # The company purchased $2,840 of computer supplies from Harris office Products on credit with terms of n/30, POB destination, Invoice dated March 8. 9 The company received the balance due from Delta co. for merchandise Hold on February 23. 11 The company paid $920 cash for minor repairs to the company's computer. 16 The company received $5,270 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due of $4,070 to Harris Office Products, consisting of amounts created on December 15 (of $1,230) and March 8. 24 The company billed Hasy Leasing for $9.107 of computing services provided. 25 The company sold merchandise with a $2,112 cost for $2,830 on credit to Wildcat Services, invoice dated March 25. 30 The company sold merchandise with a $1,098 cost for $2,260 on credit to IPM Company, invoice dated March 30. 31 The company reimbursed Santana Rey $192 cash for business automobile mileage. The company recorded the reimbursement as "Mileage Expense." The following additional facts are available for preparing adjustments on March 31 prior to financial statement preparation a. The March 31 amount of computer supplies still available totals $2.095 b. Prepaid Insurance coverage of $645 expired during this three-month period. c. Lyn Addie has not been paid for seven days of work at the rate of $125 per day. d. Prepaid rent of $2,685 expired during this three month period. e. Depreciation on the computer equipment for January 1 through March 31 is $1.230. f. Depreciation on the office equipment for January 1 through March 31 is $320. 9. The March 31 amount of merchandise inventory still available totals $554 5. Prepare a statement of retained earnings (from the adjusted trial balance in part 3) for the three months ended March 31, 2021. BUSINESS SOLUTIONS Statement of Retained Earnings For Three Months Ended March 31, 2021 Retained earnings. Dec. 31, 2020 0 Retained earings, March 31, 2021 $ 0 In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 1/10,n/30, FOB shipping point to all customers who purchase this merchandise. However, no cash discount is available on consulting fees. Additional accounts (Nos. 119, 413, 414, 415, and 502) are added to its general ledger to accommodate the company's new merchandising activities. Its transactions for January through March follow. Jan. The company paid cash to Lyn Addie for five days' work at the rate of $125 per day. Your of the five daye relate to wage payable that were accrued in the prior year. 5 santana Rey invested an additional $24,700 cash in the company in exchange for more conon stock. 7 The company purchased $7,500 of merchandise from Kansas Corp. With terms of 1/10, 1/30, POR shipping point, invoice dated January 7. The company received $2,020 cash from dones co. as full payment on ita account. 11 The company completed a five-day project for Alex'a Ingineering co. and billed it $5,420, which is the total price of 16,900 leon the advance payment of $1,400. The company debited Unearned computer Services Revenue for $1,400. 13 The company sold merchandise with a real value of $4,500 and a coat of $3,510 to Liu Corp., Invoice dated January 13 15 The company paid 6610 cash for freight charges on the nerchandise purchased on January %. 16 The company received 84,190 cash from Delta Co, for computer services provided 17. The company paid Kansas Corp. for the Livolow dated January 7, net of the discount. 20 The company gave a price reduction allowance) of 6500 to Liu corp. and credited Liu's accounts receivable for that amount. 22 The company received the balance due fron lu Corp.net of the discount and the allowance. 24 The company returned defective merchandise to Kansas Corp. and accepted a credit against future purchases (debited accounts payable). The detective merchandise Invoice cost, net of the discount, was 5496. 26 The company purchased 59.500 of merchandise from Kansas Corp. with term of 1/10, 1/30, POB destination, invoice dated January 26. 26 The company sold merchandise with a $4,520 cost for 55,890 on credit to ko, Ine. Invoice dated JARTY 26 11 The company paid cash to Tyn addie for 10 days' work at $125 per day. Feb. 1 The company paid $2.655 con to Hillside Mail for another three months' rent in advance. The company paid Kansas Corp. for the balance due, net of the cash discount, less the $496 credit from merchandise returned on January 24 5 The company paid 5430 cash to Facebook for an advertisement to appear on February 5 only. 11 The company received the balance de froe Alex's Engineering Co. for fees billed on January 11. 15 The company paid a $4,700 cash dividend. 23 The company cold merchandise with a $2,470 coat for $3,390 on credit to Delta Co., Invoice dated February 23. 26 The company pold cash to Lyn Addie for eight days' work at $125 per day. 27 The company reimbursed Santana Hey $192 cash for business automobile mileage. The company recorded the reimbursement as "kileage Expense." The company purchased $2,840 of computer supplies from Harris Office Products on credit with terms of n/30, on destination, invoice dated March 8. The company received the balance dou from Delta Co. for merchandise sold on February 23. 11 The company paid $920 cash for minor repairs to the company's computer. 16 The company received $5,270 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due of $4,070 to Harris office Products, consisting of amounts created on December 15 (of $1,230) and March 8. 24 The company billed any Leasing for $9,107 of computing services provided. 25 The company sold merchandise with a $2,112 coat for $2,030 on credit to Wildcat Services, Invoice dated March 25. 30 The company sold merchandise with a $1,098 cost for $2,260 on credit to ITM Company. Invoice dated March 30. 31 The company reimbursed Santana Rey 5192 cash for business automobile nileage. The company recorded the reimbursement as Mileage Expense." Mar The following additional facts are available for preparing adjustments on March 31 prior to financial statement preparation a. The March 31 amount of computer supplies still allahie totals $7095 Santana Rey created Business Solutions on October 1, 2020. The company has been successful, and its list of customers has grown. To accommodate the growth, the accounting system is modified to set up separate accounts for each customer. The following chart of accounts includes the account number used for each account and any balance as of December 31, 2020. Santana Rey decided to add a fourth digit with a decimal point to the 106 account number that had been used for the single Accounts Receivable account. This change allows the company to continue using the existing chart of accounts Credit Debit $48,392 0 0 0 3,100 0 2,828 es 0 0 0 630 1.935 895 8,030 $ 320 167 21,100 No. Account Title 101 Cash 106.1 Alex's Engineering Co. 106.2 Wildcat Services 106.3 Tasy Leasing 106.4 ITM Co. 106.5 Liu Corp. 106.6 Comex Co. 106.7 Delta Co. 106.8 ke, Inc. 106.9 Dream, Ine. 119 Merchandise inventory 126 Computer supplies 120 Prepaid insurance 131 Prepaid rent 163 office equipment 164 Accumulated depreciation office equipment Computer equipment 168 Accumulated depreciation Computer equipment 201 Accounts payablo 210 Wages payable 236 Unearned computer services revenue Common stock 318 Retained earnings 319 Dividends 403 Computer services revenue 413 Sales 414 Sales returns and allowances 415 Sales discounts 502 Cost of goods sold 612 Depreciation expense-office equipment 613 Depreciation expense-Computer equipment 623 Wages expense 637 Insurance expense 640 Rent expense 652 Computer supplies expense 655 Advertising expense 676 Mileage expense 677 Miscellaneous expenses 684 Repairs expense-computer 1,230 1,230 500 1,480 73,890 8,260 307 0 0 0 0 0 0 0 In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 110, n/30, FOB shipping point to all customers who purchase this marchandi on consulting tees. Additional accounts (US, 119, 13.1.10. O the company's new merchandising activities. Its transactions for January through March follow, Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of $125 per day. Four of the five days relate to wagen payable that were accrued in the prior year. 5 Santana Rey invested an additional $24,700 cash in the company in exchange for more common stock. 7 The company purchased $2,500 of merchandise fron Kansas Corp. with term of 1/10, n/30, POB shipping point, invoice dated January 7. 9 The company received $2,028 cash from Gomes Co. a full payment on to account. 11 The company completed a five-day project for Alex's Engineering co. and billed it $5,420, which is the total price of $6,900 loss the advance payment of $1,480. The company debited Unearned Computer Services Revenue for $1,480. 1) The company sold nerchandise with a retail value of $4,500 and a cont of $3,510 to Liu Corp., invoice dated January 1). 15 The company paid $690 cash for freight charges on the merchandise purchased on January 7. 16 The company received $4,170 cash from Delta co. for computer services provided. 17 The company paid Kansas Corp. for the invoice dated January 7, net of the discount. 20 The company gave a price reduction (allowance) of $500 to Liu Corp. and credited Liu's accounts receivable for that amount. 22 The company received the balance due from Liu corp., net of the discount and the allowance. 24 The company returned detective merchandise to Kansas Corp. and accepted a credit against future purchases (debited accounts payable). The defective merchandise invoice cost, net of the discount, was $496. 26 The company purchased $9,500 of merchandise from Kansas Corp. with terns of 1/10, n/30, POB destination, invoice dated January 26. 26 The company sold merchandise with a $4,520 cost for $5,890 on credit to KC, Inc., invoice dated January 26. 31 The company paid cash to Lyn Addie for 10 days work at $125 per day. Teb. The company paid $2,685 cash to Hillside Mall for another three months rent in ad ce. 3 The company paid Kansas Corp. for the balance due, net of the cash discount, less the $496 credit fron merchandise returned on January 24. 5 The company paid $430 cash to Facebook for an advertisement to appear on February 5 only. 11 The company received the balance due from Alex's Engineering Co. for fees billed on January 11. 15 The company paid a $4,700 cash dividend. 23 The company sold merchandise with a $2,470 cost for $3,390 on credit to Delta Co., invoice dated February 23. 26 The company paid cash to Lyn Addie for eight days work at $125 per day. 27 The company reimbursed Santana Rey $192 cash for business automobile mileage. The company recorded the reimbursement as "Mileage Expense." Mar. B. The company purchased $2,840 of computer supplies from Harris office Products on credit with terms of n/30, FOB destination, invoice dated March 8. 9 The company received the balance due from Delta co. for merchandise sold on February 23. 11 The company paid $920 cash for minor repairs to the company's computer. 16 The company received $5,270 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due of $4,070 to Harris office Products, consisting of amounts created on December 15 (of $1,230) and March 8. 24 The company billed Easy Leasing for $9,107 of computing services provided. 25 The company sold merchandise with a $2,112 cost for $2,830 on credit to Wildcat Services, Invoice dated March 25. 30 The company sold merchandise with a $1,098 cost for $2,260 on credit to ITM Company, invoice dated March 30. 31 The company reimbursed Santana Rey $192 cash for business automobile mileage. The company recorded the reimbursement as Mileage Expense. The following additional facts are available for roaring References ar the company reimbursed Santana Rey $192 cash for business automobile mileage. The company recorded the reimbursement as "Mileage Expense. Mar. # The company purchased $2,840 of computer supplies from Harris office Products on credit with terms of n/30, POB destination, Invoice dated March 8. 9 The company received the balance due from Delta co. for merchandise Hold on February 23. 11 The company paid $920 cash for minor repairs to the company's computer. 16 The company received $5,270 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due of $4,070 to Harris Office Products, consisting of amounts created on December 15 (of $1,230) and March 8. 24 The company billed Hasy Leasing for $9.107 of computing services provided. 25 The company sold merchandise with a $2,112 cost for $2,830 on credit to Wildcat Services, invoice dated March 25. 30 The company sold merchandise with a $1,098 cost for $2,260 on credit to IPM Company, invoice dated March 30. 31 The company reimbursed Santana Rey $192 cash for business automobile mileage. The company recorded the reimbursement as "Mileage Expense." The following additional facts are available for preparing adjustments on March 31 prior to financial statement preparation a. The March 31 amount of computer supplies still available totals $2.095 b. Prepaid Insurance coverage of $645 expired during this three-month period. c. Lyn Addie has not been paid for seven days of work at the rate of $125 per day. d. Prepaid rent of $2,685 expired during this three month period. e. Depreciation on the computer equipment for January 1 through March 31 is $1.230. f. Depreciation on the office equipment for January 1 through March 31 is $320. 9. The March 31 amount of merchandise inventory still available totals $554 5. Prepare a statement of retained earnings (from the adjusted trial balance in part 3) for the three months ended March 31, 2021. BUSINESS SOLUTIONS Statement of Retained Earnings For Three Months Ended March 31, 2021 Retained earnings. Dec. 31, 2020 0 Retained earings, March 31, 2021 $ 0 In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 1/10,n/30, FOB shipping point to all customers who purchase this merchandise. However, no cash discount is available on consulting fees. Additional accounts (Nos. 119, 413, 414, 415, and 502) are added to its general ledger to accommodate the company's new merchandising activities. Its transactions for January through March follow. Jan. The company paid cash to Lyn Addie for five days' work at the rate of $125 per day. Your of the five daye relate to wage payable that were accrued in the prior year. 5 santana Rey invested an additional $24,700 cash in the company in exchange for more conon stock. 7 The company purchased $7,500 of merchandise from Kansas Corp. With terms of 1/10, 1/30, POR shipping point, invoice dated January 7. The company received $2,020 cash from dones co. as full payment on ita account. 11 The company completed a five-day project for Alex'a Ingineering co. and billed it $5,420, which is the total price of 16,900 leon the advance payment of $1,400. The company debited Unearned computer Services Revenue for $1,400. 13 The company sold merchandise with a real value of $4,500 and a coat of $3,510 to Liu Corp., Invoice dated January 13 15 The company paid 6610 cash for freight charges on the nerchandise purchased on January %. 16 The company received 84,190 cash from Delta Co, for computer services provided 17. The company paid Kansas Corp. for the Livolow dated January 7, net of the discount. 20 The company gave a price reduction allowance) of 6500 to Liu corp. and credited Liu's accounts receivable for that amount. 22 The company received the balance due fron lu Corp.net of the discount and the allowance. 24 The company returned defective merchandise to Kansas Corp. and accepted a credit against future purchases (debited accounts payable). The detective merchandise Invoice cost, net of the discount, was 5496. 26 The company purchased 59.500 of merchandise from Kansas Corp. with term of 1/10, 1/30, POB destination, invoice dated January 26. 26 The company sold merchandise with a $4,520 cost for 55,890 on credit to ko, Ine. Invoice dated JARTY 26 11 The company paid cash to Tyn addie for 10 days' work at $125 per day. Feb. 1 The company paid $2.655 con to Hillside Mail for another three months' rent in advance. The company paid Kansas Corp. for the balance due, net of the cash discount, less the $496 credit from merchandise returned on January 24 5 The company paid 5430 cash to Facebook for an advertisement to appear on February 5 only. 11 The company received the balance de froe Alex's Engineering Co. for fees billed on January 11. 15 The company paid a $4,700 cash dividend. 23 The company cold merchandise with a $2,470 coat for $3,390 on credit to Delta Co., Invoice dated February 23. 26 The company pold cash to Lyn Addie for eight days' work at $125 per day. 27 The company reimbursed Santana Hey $192 cash for business automobile mileage. The company recorded the reimbursement as "kileage Expense." The company purchased $2,840 of computer supplies from Harris Office Products on credit with terms of n/30, on destination, invoice dated March 8. The company received the balance dou from Delta Co. for merchandise sold on February 23. 11 The company paid $920 cash for minor repairs to the company's computer. 16 The company received $5,270 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due of $4,070 to Harris office Products, consisting of amounts created on December 15 (of $1,230) and March 8. 24 The company billed any Leasing for $9,107 of computing services provided. 25 The company sold merchandise with a $2,112 coat for $2,030 on credit to Wildcat Services, Invoice dated March 25. 30 The company sold merchandise with a $1,098 cost for $2,260 on credit to ITM Company. Invoice dated March 30. 31 The company reimbursed Santana Rey 5192 cash for business automobile nileage. The company recorded the reimbursement as Mileage Expense." Mar The following additional facts are available for preparing adjustments on March 31 prior to financial statement preparation a. The March 31 amount of computer supplies still allahie totals $7095
