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. No. 101 Cash Account Title 106.1 Alex's Engineering Co. 106.2 Wildcat Services 106.3 Easy Leasing 106.4 IFM Co. 106.5 Liu Corp. 106.6 Gomez Co. 106.7 Delta Co. 106.8 KC, Inc. Dream, Inc. Merchandise inventory Computer supplies 106.9 119 126 128 Prepaid insurance 131 Prepaid rent 163 Office equipment 164 Accumulated depreciation-Office equipment 167 Computer equipment 168 Accumulated depreciation-Computer equipment 201 Accounts payable 210 Wages payable 236 Unearned computer services revenue 307 Common stock 318 Retained earnings 319 403 413 Sales 414 415 Sales discounts 502 612 613 623 Wages expense 637 640 652 655 Dividends Computer services revenue Sales returns and allowances Cost of goods sold Depreciation expense-Office equipment Depreciation expense-Computer equipment Insurance expense Rent expense Computer supplies expense Advertising expense 676 Mileage expense 677 Miscellaneous expenses 684 Repairs expense-Computer Debit Credit $48,472 0 0 0 3,150 0 2,858 0 0 0 0 750 1,989 905 8,060 $ 390 21,600 1,140 1,290 780 1,340 75,984 6,860 0 0 0 0 0 0 I III .... 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 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. Feb. Mar. 4 The company paid cash to Lyn Addie for five days' work at the rate of $195 per day. Four of the five days relate to wages payable that were accrued in the prior year. 5 Santana Rey invested an additional $25,000 cash in the company in exchange for more common stock. 7 The company purchased $6,200 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB shipping point, invoice dated January 7. 9 The company received $2,858 cash from Gomez Co. as full payment on its account. 11 The company completed a five-day project for Alex's Engineering Co. and billed it $5,480, which is the total price of $6,820 less the advance payment of $1,340. The company debited Unearned Computer Services Revenue for $1,340. 13 The company sold merchandise with a retail value of $4,900 and a cost of $3,490 to Liu Corp., invoice dated January 13. 15 The company paid $630 cash for freight charges on the merchandise purchased on January 7. 16 The company received $4,140 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 $400 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 defective merchandise to Kansas Corp. and accepted a credit against future purchases (debited accounts payable). The defective merchandise invoice cost, net of the discount, was $476. 26 The company purchased $9,900 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB destination, invoice dated January 26. 26 The company sold merchandise with a $4,550 cost for $5,850 on credit to KC, Inc., invoice dated January 26. 31 The company paid cash to Lyn Addie for 10 days' work at $195 per day. 1 The company paid $2,715 cash to Hillside Mall for another three months' rent in advance. 3 The company paid Kansas Corp. for the balance due, net of the cash discount, less the $476 credit from merchandise returned on January 24. 5 The company paid $530 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 $4,660 cash dividend. 23 The company sold merchandise with a $2,490 cost for $3,410 on credit to Delta Co., invoice dated February 23. 26 The company paid cash to Lyn Addie for eight days' work at $195 per day. 27 The company reimbursed Santana Rey $256 cash for business automobile mileage. The company recorded the reimbursement as "Mileage Expense." 8 The company purchased $2,790 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 $5,340 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due of $4,080 to Harris Office Products, consisting of amounts created on December 15 (of $1,290) and March 8. 24 The company billed Easy Leasing for $9,077 of computing services provided. 25 The company sold merchandise with a $2,182 cost for $2,850 on credit to Wildcat Services, invoice dated March 25. 30 The company sold merchandise with a $1,198 cost for $2,380 on credit to IFM Company, invoice dated March 30. 31 The company reimbursed Santana Rey $160 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 $2,165. b. Prepaid Insurance coverage of $663 expired during this three-month period. c. Lyn Addie has not been paid for seven days of work at the rate of $195 per day. d. Prepaid rent of $2,715 expired during this three-month period. e. Depreciation on the computer equipment for January 1 through March 31 is $1,140. f. Depreciation on the office equipment for January 1 through March 31 is $390. g. The March 31 amount of merchandise Inventory still available totals $594. quired: Prepare Journal entries to record each of the January through March transactions. View transaction list Journal entry worksheet < 1 2 3 4 5 6 7 8 37 The company paid cash to Lyn Addie for five days' work at the rate of $195 per day. Four of the five days relate to wages payable that were accrued in the prior year. Note: Enter debits before credits. Date Jan 04 General Journal Debit Credit Record entry Clear entry View general journal Journal entry worksheet > 1 2 3 4 5 678 37 Santana Rey invested an additional $25,000 cash in the company in exchange for more common stock. Note: Enter debits before credits. Date Jan 05 General Journal Debit Credit 2. Post the journal entries in part 1 to the accounts in the company's general ledger. Note: Begin with the ledger's post-closing adjusted balances as of December 31, 2020. 106.1: Accounts Receivable-Alex's Engineering Co. 101: Cash Date Debit Credit Balance Date Dec. 31 Dec. 31 106.2: Accounts Receivable-Wildcat Services Date Dec. 31 Debit Credit Balance Date 0 Dec. 31 Debit Credit Balance 0 106.3: Accounts Receivable-Easy Leasing Debit Credit Balance 0 106.2: Accounts Receivable-Wildcat Services Date Dec. 31 Date Dec. 31 Date Dec. 31 Date Dec. 31 Debit Credit 106.4: Accounts Receivable-IFM Co. Debit Credit 106.6: Accounts Receivable-Gomez Co. Debit Credit 106.8: Accounts Receivable-KC, Inc. Debit Credit Balance Date 0 Dec. 31 Balance Date Dec. 31 Balance Date Dec. 31 106.3: Accounts Receivable-Easy Leasing Debit Credit Balance 0 106.5: Accounts Receivable-Liu Corporation Balance Date 0 Dec. 31 Debit Credit 106.7: Accounts Receivable-Delta Co. Debit Credit 106.9: Accounts Receivable-Dream, Inc. Debit Credit Balance 0 Balance 0 Balance 0 Date Dec. 31 119: Merchandise Inventory Debit Credit Balance Date 0 Dec. 31 126: Computer Supplies Debit Credit Balance Credit Balance Date Dec. 31 131: Prepaid Rent Debit Credit Balance Date Dec. 31 128: Prepaid Insurance Debit Date Dec. 31 163: Office Equipment Debit 164: Accumulated Depreciation-Office Equipment Credit Balance Date Dec. 31 Debit Credit Balance Date Dec. 31 Date Dec. 31 Date Dec. 31 Date Dec. 31 167: Computer Equipment Debit 168: Accumulated Depreciation-Computer Equipment Credit Balance Date Dec. 31 Debit Credit Balance 201: Accounts Payable Debit 210: Wages Payable Credit Balance Date Dec. 31 Debit Credit Balance 236: Unearned Computer Services Revenue Debit Credit Balance Date Dec. 31 307: Common Stock Debit Credit Balance 318: Retained Earnings 319: Dividends Debit Credit Balance Date Debit Credit Balance Date Date 414: Sales Returns and Allowances Debit Credit 502: Cost of Goods Sold Debit Credit 415: Sales Discounts Balance Date Debit Credit Balance 612: Depreciation Expense-Office Equipment Balance Date 613: Depreciation Expense-Computer Equipment Date Debit Credit Debit Credit Balance 623: Wages Expense Balance Date Debit Credit Balance Date Date 637: Insurance Expense 640: Rent Expense Debit Credit Balance Date Debit Credit Balance 652: Computer Supplies Expense Debit Credit 655: Advertising Expense Balance Date Debit Credit Balance 676: Mileage Expense Date Debit Credit Balance Date Date 684: Repairs Expense-Computer Debit Credit Balance 677: Miscellaneous Expenses Debit Credit Balance No. 101 Cash BUSINESS SOLUTIONS Partial Work Sheet March 31, 2021 Unadjusted Trial Balance Account Title Dr. 106.1 Alex's Engineering Co. 106.2 Wildcat Services 106.3 Easy Leasing 106.4 IFM Co. 106.5 Liu Corp. 106.6 Gomez Co. 106.7 Delta Co. 106.8 KC, Inc. 106.9 Dream, Inc. 119 Merchandise inventory 126 Computer supplies 128 Prepaid insurance 131 Prepaid rent 163 164 167 168 Office equipment Accumulated depreciation-Office equipment Computer equipment Accumulated depreciation-Computer equipment 201 Accounts payable 210 Wages payable 236 Unearned computer services revenue 307 Common stock 318 Retained earnings 319 Dividends 403 Computer services revenue 413 Sales Adjustments Cr. Dr. Adjusted Trial Balance Cr. Dr. Cr. 131 Prepaid rent 163 Office equipment 164 167 168 Accumulated depreciation-Office equipment Computer equipment Accumulated depreciation-Computer equipment 201 Accounts payable 210 Wages payable 236 307 Unearned computer services revenue Common stock 318 Retained earnings 319 Dividends 403 413 Computer services revenue Sales 414 Sales returns and allowances 415 Sales discounts 502 Cost of goods sold 612 613 623 637 640 652 Depreciation expense-Office equipment Depreciation expense-Computer equipment Wages expense Insurance expense Rent expense Computer supplies expense 655 Advertising expense 676 Mileage expense 677 684 Miscellaneous expenses Repairs expense-Computer Totals