On October 1, 2018, Santana Rey launched a computer services company called Business Solutions, which provides consulting services, computer system installations, and custom program development. Rey adopts the calendar year for reporting purposes and expects to prepare the companys first set of financial statements on December 31, 2018. The company is doing business as a sole proprietorship.

Required 1. Prepare journal entries to record each of the October, November, and December transactions and events for Business Solutions. 2. Post those entries to the accounts in the ledger. 2. Prepare adjusting entries to reflect a through f. Post those entries to the accounts in the ledger. 3. Prepare an adjusted trial balance as of December 31, 2018. 4. Prepare an income statement for the three months ended December 31, 2018. 5. Prepare a statement of owner's equity for the three months ended December 31, 2018. 6. Prepare a balance sheet as of December 31, 2018.

The companys initial chart of accounts follows:

1. In Excel, prepare journal entries to record each of the following transactions for Business Solutions. Oct. 1 S. Rey invested $45,000 cash, a $20,000 computer system, and $8,000 of office equipment in the company. 2 The company paid $3,300 cash for four months rent. (Hint: Debit Prepaid Rent for $3,300.) 3 The company purchased $1,420 of computer supplies on credit from Harris Office Products. 5 The company paid $2,220 cash for one years premium on a property and liability insurance policy. (Hint: Debit Prepaid Insurance for $2,220.) 6 The company billed Easy Leasing $4,800 for services performed in installing a new web server. 8 The company paid $1,420 cash for the computer supplies purchased from Harris Office Products on October 3. 10 The company hired Lyn Addie as a part-time assistant for $125 per day, as needed. 12 The company billed Easy Leasing another $1,400 for services performed. 15 The company received $4,800 cash from Easy Leasing as partial payment on its account. 17 The company paid $805 cash to repair computer equipment that was damaged when moving it. 20 The company paid $1,728 cash for advertisements published in the local newspaper. 22 The company received $1,400 cash from Easy Leasing on its account. 28 The company billed IFM Company $5,208 for services performed. 31 The company paid $875 cash for Lyn Addies wages for seven days work. 31 S. Rey withdrew $3,600 cash from the company for personal use.

Nov. 1 The company reimbursed S. Rey in cash for business automobile mileage allowance (Rey logged 1,000 miles at $0.32 per mile). 2 The company received $4,633 cash from Liu Corporation for computer services performed. 5 The company purchased computer supplies for $1,125 cash from Harris Office Products. 8 The company billed Gomez Co. $5,668 for services performed. 13 The company received notification from Alexs Engineering Co. that Business Solutions bid of $3,950 for an upcoming project is accepted. 18 The company received $2,208 cash from IFM Company as partial payment of the October 28 bill. 22 The company donated $250 cash to the United Way in the companys name. 24 The company completed work for Alexs Engineering Co. and sent it a bill for $3,950. 25 The company sent another bill to IFM Company for the past-due amount of $3,000. 28 The company reimbursed S. Rey in cash for business automobile mileage (1,200 miles at $0.32 per mile). 30 The company paid $1,750 cash for Lyn Addies wages for 14 days work.

30 S. Rey withdrew $2,000 cash from the company for personal use.

Dec. 3 Paid $1,025 cash to Hillside Mall for Business Solutions' share of mall advertising costs. 4 Paid $500 cash for minor repairs to the company's computer. 10 Received $3,950 cash from Alex's Engineering Co. for the receivable from November. 14 Paid cash to Lyn Addie for six days of work at the rate of $125 per day. 15 Notified by Alex's Engineering Co. that Business Solutions' bid of $7,000 on a proposed project has been accepted. Alex's paid a $1,500 cash advance to Business Solutions. 16 Purchased $1,100 of computer supplies on credit from Harris Office Products. 20 Sent a reminder to Gomez Co. to pay the fee for services recorded on November 8. 2226 Completed a project for Liu Corporation and received $5,625 cash. 28 Took the week off for the holidays. 29 Received $3,000 cash from Gomez Co. on its receivable. 31 Reimbursed S. Rey for business automobile mileage (600 miles at $0.32 per mile). 31 S. Rey withdrew $1,500 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: 1. The December 31 inventory count of computer supplies shows $580 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 $125 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. Required 7. Prepare journal entries to record each of the October, November, and December transactions and events for Business Solutions. 8. Post those entries to the accounts in the ledger. 9. Prepare adjusting entries to reflect a through f. Post those entries to the accounts in the ledger. 10. Prepare an adjusted trial balance as of December 31, 2018. 11. Prepare an income statement for the three months ended December 31, 2018. 12. Prepare a statement of owner's equity for the three months ended December 31, 2018. 6. Prepare a balance sheet as of December 31, 2018.

Check figures: (3) Adjusted trial balance totals, $109,034 (6) Total assets, $83,460

Date Account Title 1-OctCash Office equipment Computer equipment Common Stook Debit Credit 45,000 8,000 20,000 73,000 3,300 2-Oct Prepaid Rent Cash 3,300 1,420 3-Oct Computer Supplies Account Payable 1,420 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 20 21 2 23 2,220 5-Oct Prepaid Insurance Cash 2,220 4,800 6-OctAccounts receivable Computer service renvenue 4,800 1,420 8-Oct Accounts Payable Cash 1,420 1,400 12-Oct Accounts receivable Computer service revenue 1,400 4,800 15-Oct Cash Accounts recivable 4,800 805 17-Oct Repairs Expense - Computer Cash 805 25 26 27 28 29 30 31 2 33 34 1,728 20-Oct Advertsing expense Cash 1,728 1,400 22-Oct Cash Accounts receivable 1,400 5,208 28-Oct Accounts receivable Computer service revenue 5208 37 38 39 10 11 2 875 31-Oct Wages expense Caash 875 31-Oct Dividends Cash 3,600 3,600 3201 6 7 1-Nov Mileage expense Cash 320 4,633 2-Nov Cash Computer service revenue 4,633 5-Nov Computer supplies cash 1,1251 1,125 5,668 8-Nov Accounts receivable Computer services revenue 5,668 2,208 18-Nov Cash Accounts receivable 2,208 250 9 0 1 2 3 4 5 6 7 8 9 0 1 2 2 3 4 5 6 7 8 9 0 1 2. 3 4 22-Nov Miscellaneous expense Cash 250 3,950 24-Nov Accounts receivable Computer servies revenue 3,950 384 28-Now Mileage expense Cash 384 30-Nov Wages expense Cash 1,750 1,750 2,000 30-Nov Dividends Cash 2,000 1,025 1,025 500 500 3,950 3,950 7501 750 1500 3-Dec Advertising Expense 7 Cash 3 4-Dec Repairs Expense - Computer ) Cash 1 2 10-Dec Cash 3 Accounts receivable # 5 14-Dec Wage expense Cash 7 3 15-Dec Cash 3 Unearned computer service revenue ) 1 16-Deo Computer Supplies 2 Accounts Payable 3 # 26-Dec Cash 5 Computer service revenue 5 7 29-Dec Cash 3 Accounts receivable 3 31-Dec Mileage expence 1 Cash 1,500 1,100 1,100 5,625 5,625 3,000 3,000 192 192 1,500 3 4 5 31-Dec Dividends Cash 1,500