SP 4 Serial Problem Business Solutions (Algo) LO P1, P2, P3, P4 [The following information applies to the questions displayed below) Santana Rey created Business Solutions on October 1, 2021. 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, 2021. 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. Number Account Title 101 Cash 106.1 Alex's Engineering Company 106.2 Wildcat Services 106.3 Easy Leasing 106.4 IFM Company 106.5 Liu Corporation 106.6 106.7 106.8 KC, Incorporated 106.9 119 126 128 Gonez Company Delta Company Dream, Incorporated Merchandise inventory Computer supplies. Prepaid insurance 131 Prepaid rent Debit Credit $ 48,552 " 3,180 0 2,808 700 2,097 865 < Prev 2 6 of 6 Novt 106.4 106.5 IFM Company 3,180 Liu Corporation 106.6 Gomez Company 2,808 106.7 Delta Company 0 106.8 KC, Incorporated e 106.9 Dream, Incorporated e 119 Merchandise inventory 0 126 Computer supplies 700 128 Prepaid insurance 2,097 131 Prepaid rent 865 163 Office equipment 8,080 164 Accumulated depreciation-office equipment $ 380 167 Computer equipment 168 Accumulated depreciation-Computer equipment 21,700 201 Accounts payable 1,130 1,190 210 Wages payable 236 Unearned computer services revenue 301 Common stock 620 1,390 75,612 318 Retained earnings 7,660 319 403 413 414 415 502 612 613 623 637 Dividends Computer services revenue Sales Sales returns and allowances Sales discounts Cost of goods sold Depreciation expense-office equipment Depreciation expense-Computer equipment Wages expense Insurance expense 640 Rent expense Insurance expense Rent expense Computer supplies expense 965 wages expense 637 640 652 655 676 677 684 Mileage expense Repairs expense-Computer Advertising expense Miscellaneous expenses 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 (Numbers. 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 January 4 The company paid cash to Lyn Addie for five days' work at the rate of $155 per day. Four of the five days relate to wages payable that were accrued in the prior year. January 5 Santana Rey invested an additional $24,500 cash in the company in exchange for more common stock. January 7 The company purchased $6,100 of merchandise from Kansas Corporation with terms of 1/10, n/30, F08 shipping point, invoice dated January 7. January 9 The company received $2,808 cash from Gomez Company as full payment on its account. January 11 The company completed a five-day project for Alex's Engineering Company and billed it $5,420, which is the total price of $6,810 less the advance payment of $1,390. The company debited Unearned Computer Services Revenue for $1,390. January 13 January 15 The company sold merchandise with a retail value of $4,100 and a cost of $3,370 to Liu Corporation, invoice dated January 13. The company paid $650 cash for freight charges on the merchandise purchased on January 7. The company received $4,140 cash from Delta Company for computer services provided. The company paid Kansas Corporation for the invoice dated January 7, net of the discount. January 20 The company gave a price reduction (allowance) of $700 to Liu Corporation and credited Liu's accounts January 16 January 17 Prev January 17 The company paid Kansas Corporation for the invoice dated January 7, net of the discount. January 20 The company gave a price reduction (allowance) of $700 to Liu Corporation and credited Liu's accounts receivable for that amount. January 22 The company received the balance due from Liu Corporation, net of the discount and the allowance. January 24 The company returned defective merchandise to Kansas Corporation and accepted a credit against future purchases (debited accounts payable). The defective merchandise invoice cost, net of the discount, was January 26 The company purchased $9,200 of merchandise from Kansas Corporation with terms of 1/10, n/30, FOB destination, invoice dated January 26. $496. January 26 The company sold merchandise with a $4,450 cost for $5,878 on credit to KC, Incorporated, invoice dated January 26. January 31 The company paid cash to Lyn Addie for 10 days' work at $155 per day. February 1 The company paid $2,595 cash to Hillside Mall for another three months' rent in advance. February 3 The company paid Kansas Corporation for the balance due, net of the cash discount, less the $496 credit from merchandise returned on January 24. February 5 The company paid $540 cash to Facebook for an advertisement to appear on February 5 only. February 11 The company received the balance due from Alex's Engineering Company for fees billed on January 11. February 15 The company paid a $4,780 cash dividend. February 23 The company sold merchandise with a $2,590 cost for $3,420 on credit to Delta Company, invoice dated February 23. February 26 The company paid cash to Lyn Addie for eight days' work at $155 per day. February 27 The company reimbursed Santana Rey $64 cash for business automobile mileage. The company recorded the reimbursement as "Mileage Expense." March 8 The company purchased $2,760 of computer supplies from Harris Office Products on credit with terms of n/30, FOB destination, invoice dated March 8. March 9 The company received the balance due from Delta Company for merchandise sold on February 23. March 11 March 16 March 19 The company paid $850 cash for minor repairs to the company's computer. The company received $5,350 cash from Dream, Incorporated, for computing services provided. The company paid the full amount due of $3,950 to Harris Office Products, consisting of amounts created on December 15 (of $1.190) and March 8. March 19 The company paid the full amount due of $3,950 to Harris Office Products, consisting of amounts created on December 15 (of $1,190) and March 8. March 24 The company billed Easy Leasing for $9,167 of computing services provided. March 25 The company sold merchandise with a $2,162 cost for $2,980 on credit to Wildcat Services, invoice dated March 25. March 30 The company sold merchandise with a $1,188 cost for $2,370 on credit to IFM Company, invoice dated March 30. March 31 The company reimbursed Santana Rey $128 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 $699 expired during this three-month period. c. Lyn Addie has not been paid for seven days of work at the rate of $155 per day. d. Prepaid rent of $2,595 expired during this three-month period. e. Depreciation on the computer equipment for January 1 through March 31 is $1,130. f. Depreciation on the office equipment for January 1 through March 31 is $380 g. The March 31 amount of merchandise inventory still available totals $524. SP 4 Serial Problem Part 2 (Algo) 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, 2021 101: Cash Date December 31 Debit Credit Balance Debit 106.1: Accounts Receivable Alex's Engineering Company Date Credit December 31 4 Balance 0 106.2: Accounts Receivable Wildcat Services Date December 31 Date December 31 Debit Credit 106.4: Accounts Receivable IFM Company Debit Credit 106.3: Accounts Receivable-Easy Leasing Balance 0 Date December 31 Debit Credit Balance 0 106.5: Accounts Receivable-Liu Corporation Balance Date December 31 106.6: Accounts Receivable-Gomez Company Date December 31 Debit Credit Debit Credit Balance 0 106.7: Accounts Receivable Delta Company Balance: Date December 31 Debit Credit Balance: 106.6: Accounts Receivable-Gomez Company Date December 31 Debit Credit 106.7: Accounts Receivable-Delta Company Balance Date December 31 106.8: Accounts Receivable-KC, Incorporated Date December 31 Date December 31 Debit Credit 119: Merchandise Inventory Debit Debit Credit Balance 0 106.9: Accounts Receivable Dream, Incorporated Balance Date 0 December 31 Debit Credit Balance 0 126: Computer Supplies Credit Balance Date Debit Credit Balance 0 December 311 Date December 31 119: Merchandise Inventory Debit Credit Balance Date 126: Computer Supplies Debit Credit Balance December 31 128: Prepaid Insurance 131: Prepaid Rent Date: December 31 Date December 31 Date December 31 128: Prepaid Insurance Debit Credit Balance Date 131: Prepaid Rent Debit Credit Balance December 31 163: Office Equipment Debit 164: Accumulated Depreciation-Office Equipment Credit Balance Date December 31 167: Computer Equipment Debit Debit Credit Balance 168: Accumulated Depreciation-Computer Equipment Credit Balance Date December 31 Debit Credit Balance Date December 311 Date December 31 167: Computer Equipment Debit 168: Accumulated Depreciation Computer Equipment Credit Balance: Date December 31 201: Accounts Payable Debit Debit Credit Balance 210: Wages Payable Credit Balance Date December 31 Debit Credit Balance