Serial Problem Business Solutions LO P1, P2, P3, P4, P5, P6 After the success of the companys first two months, Santana Rey continues to operate Business Solutions. The November 30, 2019, unadjusted trial balance of Business Solutions (reflecting its transactions for October and November of 2019) follows. No. Account Title Debit Credit 101 Cash $ 38,264 106 Accounts receivable 12,618 126 Computer supplies 2,545 128 Prepaid insurance 2,220 131 Prepaid rent 3,300 163 Office equipment 8,000 164 Accumulated depreciationOffice equipment $ 0 167 Computer equipment 20,000 168 Accumulated depreciationComputer equipment 0 201 Accounts payable 0 210 Wages payable 0 236 Unearned computer services revenue 0 307 Common stock 73,000 318 Retained earnings 0 319 Dividends 5,600 403 Computer services revenue 25,659 612 Depreciation expenseOffice equipment 0 613 Depreciation expenseComputer equipment 0 623 Wages expense 2,625 637 Insurance expense 0 640 Rent expense 0 652 Computer supplies expense 0 655 Advertising expense 1,728 676 Mileage expense 704 677 Miscellaneous expenses 250 684 Repairs expenseComputer 805 Totals $ 98,659 $ 98,659 Business Solutions had the following transactions and events in December 2019. Dec. 2 Paid $1,025 cash to Hillside Mall for Business Solutions share of mall advertising costs. 3 Paid $500 cash for minor repairs to the companys computer. 4 Received $3,950 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 $125 per day. 14 Notified by Alexs Engineering Co. that Business Solutions bid of $7,000 on a proposed project has been accepted. Alexs paid a $1,500 cash advance to Business Solutions. 15 Purchased $1,100 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 $5,625 cash. 2226 Took the week off for the holidays. 28 Received $3,000 cash from Gomez Co. on its receivable. 29 Reimbursed S. Rey for business automobile mileage (600 miles at $0.32 per mile). 31 The company paid $1,500 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. The December 31 inventory count of computer supplies shows $580 still available. Three months have expired since the 12-month insurance premium was paid in advance. As of December 31, Lyn Addie has not been paid for four days of work at $125 per day. The computer system, acquired on October 1, is expected to have a four-year life with no salvage value. The office equipment, acquired on October 1, is expected to have a five-year life with no salvage value. Three of the four months' prepaid rent have expired.

Required: 5. Prepare a statement of retained earnings for the three months ended December 31, 2019. 6. Prepare a balance sheet as of December 31, 2019. 7. Record the necessary closing entries as of December 31, 2019 and then post the closing entries to the general ledger in Requirement 2B. 8. Prepare a post-closing trial balance as of December 31, 2019.

Req 1 Req 2A Req 2B Req3 Req 4 Reg 5 Reg 6 Prepare an income statement for the three months ended December 31, 2019. BUSINESS SOLUTIONS Income Statement For Three Months Ended December 31, 2019 Revenue Computer services revenue $ 31,284 $ 3,875) 3,065 2,475 555 Expenses Wages expense Computer supplies expense Rent expense Insurance expense Advertising expense Mileage expense Repairs expense-Computer Depreciation expense-Office equipment Depreciation expense Computer equipment Miscellaneous expenses 2,753 896 1,305 400 1,250 250 Total expenses Net income 16,824 14,460 Req 1 Req 2A Req 2B Req3 Req 4 Reg 5 Reg 6 Prepare an income statement for the three months ended December 31, 2019. BUSINESS SOLUTIONS Income Statement For Three Months Ended December 31, 2019 Revenue Computer services revenue $ 31,284 $ 3,875) 3,065 2,475 555 Expenses Wages expense Computer supplies expense Rent expense Insurance expense Advertising expense Mileage expense Repairs expense-Computer Depreciation expense-Office equipment Depreciation expense Computer equipment Miscellaneous expenses 2,753 896 1,305 400 1,250 250 Total expenses Net income 16,824 14,460 Reg 1 Reg 2A Req 2B Reg 3 Reg 4 Reg 5 Reg 6 Prepare an adjusted trial balance as of December 31, 2019. BUSINESS SOLUTIONS Adjusted Trial Balance December 31, 2019 Account Title Debit Credit $ 48,372 5,668 580 1,665 825 8,000 400 20,000 Cash Accounts receivable Computer supplies Prepaid insurance Prepaid rent Office equipment Accumulated depreciation Office equipment Computer equipment Accumulated depreciation Computer equipment Accounts payable Wages payable Unearned computer services revenue Common stock Retained earnings Dividends Computer services revenue Depreciation expense-Office equipment 1,250 1,100 500 1,500 73,000 7200 31,284 400 8,000 $ 400 20,000 1,250 1,100 500 1,500 73,000 7200 31,284 Office equipment Accumulated depreciation Office equipment Computer equipment Accumulated depreciation Computer equipment Accounts payable Wages payable Unearned computer services revenue Common stock Retained earnings Dividends Computer services revenue Depreciation expense-Office equipment Depreciation expense-Computer equipment Wages expense Insurance expense Rent expense Computer supplies expense Advertising expense Mileage expense Miscellaneous expenses Repairs expense-Computer Totals 400 1,250 3,875 555 2,475 3,065 2,753 896 250 1,205 109,034 $ $ 109,034