Taylor Scott owns and operates a consulting firm called Scott Consulting. The business began operating in October 2019. Transactions for October and November 2019 have been recorded in the general journal and posted in the general ledger. Scott Consulting had the following transactions in December 2019. Dec 2 Purchased $2,200 of computer supplies on credit from Graham Office Products. 3 Completed a project for Olympus Corporation and received $6,425 cash. 4 Paid cash to employee for five days of work at the rate of $176 per day. 10 Provided $1,985 of consulting services to Nelson Company on account. 14 Notified by True Engineering Co. that Scott Consulting's bid of $6,750 on a proposed project has been accepted. True paid a $1,200 cash advance to Scott Consulting. 15 Paid $1,130 cash to Global Mall for Scott Consulting's share of mall advertising costs. 20 Paid $250 cash for minor repairs to the company's computer. 28 Received $500 cash from Nelson Company on its receivable. 29 Reimbursed T. Scott $87 for business automobile mileage. 31 T. Scott withdrew $1,200 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 of operations: a. The December 31 inventory count of computer supplies shows $2,290 still available. b. One of the four months' prepaid rent has expired. c. Two months have expired since the 12-month insurance premium was paid in advance. d. As of December 31, the only employee of Scott Consulting had not been paid for four days of work at $176 per day. e. The computer equipment, acquired for $9,000 on October 1, is expected to have a three-year life with no salvage value. f. The office equipment, acquired for $30,000 on October 1, is expected to have a five-year life with no salvage value. Required: 1. Journalize the December transactions for Scott Consulting. You may omit explanations for the journal entries. Skip a line between each journal entry - see the journal entries for October - November as a formatting example. 2. Post the December transactions to the appropriate accounts in the ledger. 3. Prepare a trial balance to prove the equality of debits and credits prior to continuing with this project. Omit any accounts that have a zero balance. Check figure: $110,451. Consult your instructor if your trial balance does not balance before proceeding with the project. 4. Journalize the adjusting entries to reflect items a through f above. 5. Post the adjusting entries to the appropriate accounts in the ledger. 6. Prepare an adjusted trial balance as of December 31, 2019. Check figure: $113,405. Consult your instructor if your adjusted trial balance does not balance before proceeding with the project. 7. Prepare the three basic financial statements in good form. See your accounting text for a good example of financial statement formatting. 8. Prepare an income statement for the three months ended December 31, 2019. 9. Prepare a statement of owner's equity for the three months ended December 31, 2019. 10. Prepare a balance sheet as of December 31, 2019. 11. Journalize and post the necessary closing entries for Scott Consulting. 12. Prepare a post-closing trial balance as of December 31, 2019. GENERAL JOURNAL 1 PAGE DATE ACCOUNT POST DEBIT CREDIT REF 2019 Oct Cash 101 45,000 Office Equipment Computer Equipment T. Scott, Capital 163 30,000 9,000 167 301 84,000 1 Prepaid Insurance Cash 128 2,220 101 2,220 2 Prepaid Rent 131 3,300 Cash 101 3,300 9 Computer Supplies Accounts Payable 126 2,545 201 2,545 16 Accounts Receivable Consulting Revenue 106 4,800 403 4,800 31 Wages Expense Cash 623 875 101 875 Mileage Expense Cash Nov 2 676 320 101 320 MacBook Air Casim Nov 2 Mileage Expense 676 320 Cash 101 320 5 Accounts Payable 201 2,545 Cash 101 2,545 8 Cash 101 4,800 Accounts Receivable 106 4,800 14 Cash Consulting Revenue 101 4,633 403 4,633 23 Accounts Receivable Consulting Revenue 106 5,208 5,208 30 T. Scott, Withdrawals 302 2,000 Cash 101 2,000 General Journal for Requirements 1, 4 & 11 GENERAL JOURNAL PAGE 2 DATE ACCOUNT POST REF DEBIT CREDIT 2019 December Transactions (20 points) Dec GENERAL JOURNAL PAGE 3. DATE ACCOUNT POST DEBIT CREDIT REF 2019 Adjusting Entries (17 points) Dec Closing Entries (10 points) Ledger for Requirements 2, 5, & 11 Note: Ledger includes all entries from the first two months of operations for Scott Consulting. Continue by posting the December transactions. 12 points Cash Acct. No. 101 Date Explanation PR Debit Credit Balance Oct. 1 J1 45,000 45,000 42,780 1 J1 2,220 3,300 2 J1 39,480 38,605 38,285 31 J1 875 Nov. 2 J1 320 J1 2,545 35,740 40,540 45,173 43,173 8 J1 4,800 14 J1 4,633 30 J1 2,000 cle Project Instructions Accounts Receivable Acct. No. 106 Date Explanation PR Debit Credit Balance Oct. 16 J1 4,800 4,800 Nov. 8 J1 4,800 23 J1 5,208 5,208 Computer Supplies Acct. No. 126 Date Explanation 9. PR Debit 2,545 Credit Balance Oct. J1 2,545 Prepaid Insurance Acct. No. 128 Date Explanation PR Debit Credit Balance 2,220 Oct. 1 J1 2,220 Page 7 of 15 Ledger (Continued) Explanation Prepaid Rent Acct. No. 131 Date PR Debit Credit Balance Oct. J1 3,300 3,300 Office Equipment Acct. No. 163 Date Explanation PR Debit Credit Balance Oct. 1 J1 30,000 30,000 Acct. No. 164 Accumulated Depreciation-Office Equipment Explanation Date PR Debit Credit Balance Computer Equipment PR Acct. No. 167 Date Explanation Debit Credit Balance Oct. 1 J1 9,000 9,000 Accumulated Depreciation-Computer Equipment Acct. No. 168 Date Explanation PR Debit Credit Balance Acct. No. 201 MacBook Air Acct. No. 201 Accounts Payable Date Explanation PR Debit Credit Balance Oct. J1 2,545 2,545 Nov. J1 2,545 Wages Payable Acct. No. 210 Date Explanation PR Debit Credit Balance Unearned Consulting Revenue Explanation Acct. No. 236 Date PR Debit Credit Balance 9 5 T. Scott, Capital Acct. No. 301 Date Explanation PR Debit Credit Balance Oct. 1 J1 84,000 84,000 T. Scott, Withdrawals Acct. No. 302 Date Explanation PR Debit Credit Balance Nov. 30 J1 2,000 2,000 Consulting Revenue Debit Acct. No. 403 Date Explanation PR Credit Balance Oct. 16 4,800 9,433 14,641 J1 4,800 Nov. 4,633 5,208 14 J1 23 J1 Depreciation Expense-Office Equipment Debit Acct. No. 612 Date Explanation PR Credit Balance Depreciation Expense-Computer Equipment Explanation Acct. No. 613 Balance Date PR Debit Credit Wages Expense Acct. No. 623 Date Explanation PR Debit Credit Balance Oct. 31 J1 875 875 Insurance Expense Acct. No. 637 Date Explanation PR Debit Credit Balance Rent Expense Acct. No. 640 Date Explanation PR Debit Credit Balance Computer Supplies Expense Acct. No. 652 Date Explanation PR Debit Credit Balance Advertising Expense Acct. No. 655 Date Explanation PR Debit Credit Balance Mileage Expense Acct. No. 676 Date Explanation PR Debit Credit Balance Nov. J1 320 320 Repairs Expense-Computer Explanation Acct. No. 684 Date PR Debit Credit Balance Income Summary Acct. No. 901 Date Explanation PR Debit Credit Balance Working Paper for Requirement 3 3 points Scott Consulting Trial Balance December 31, 2019 DEBIT CREDIT Working Paper for Requirement 6 3 points Scott Consulting Adjusted Trial Balance December 31, 2019 DEBIT CREDIT Working Papers for Requirements 7, 8 & 9 Scott Consulting Income Statement (10 points) For Three Months Ended December 31, 2019 Scott Consulting Statement of Owner's Equity (5 points) For Three Months Ended December 31, 2019 Working Papers for Requirements 6, 7 & 8 (continued) Scott Consulting Balance Sheet (10 points) December 31, 2019 Working Papers for Requirement 12 Scott Consulting Post-Closing Trial Balance December 31, 2019 DEBIT CREDIT Taylor Scott owns and operates a consulting firm called Scott Consulting. The business began operating in October 2019. Transactions for October and November 2019 have been recorded in the general journal and posted in the general ledger. Scott Consulting had the following transactions in December 2019. Dec 2 Purchased $2,200 of computer supplies on credit from Graham Office Products. 3 Completed a project for Olympus Corporation and received $6,425 cash. 4 Paid cash to employee for five days of work at the rate of $176 per day. 10 Provided $1,985 of consulting services to Nelson Company on account. 14 Notified by True Engineering Co. that Scott Consulting's bid of $6,750 on a proposed project has been accepted. True paid a $1,200 cash advance to Scott Consulting. 15 Paid $1,130 cash to Global Mall for Scott Consulting's share of mall advertising costs. 20 Paid $250 cash for minor repairs to the company's computer. 28 Received $500 cash from Nelson Company on its receivable. 29 Reimbursed T. Scott $87 for business automobile mileage. 31 T. Scott withdrew $1,200 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 of operations: a. The December 31 inventory count of computer supplies shows $2,290 still available. b. One of the four months' prepaid rent has expired. c. Two months have expired since the 12-month insurance premium was paid in advance. d. As of December 31, the only employee of Scott Consulting had not been paid for four days of work at $176 per day. e. The computer equipment, acquired for $9,000 on October 1, is expected to have a three-year life with no salvage value. f. The office equipment, acquired for $30,000 on October 1, is expected to have a five-year life with no salvage value. Required: 1. Journalize the December transactions for Scott Consulting. You may omit explanations for the journal entries. Skip a line between each journal entry - see the journal entries for October - November as a formatting example. 2. Post the December transactions to the appropriate accounts in the ledger. 3. Prepare a trial balance to prove the equality of debits and credits prior to continuing with this project. Omit any accounts that have a zero balance. Check figure: $110,451. Consult your instructor if your trial balance does not balance before proceeding with the project. 4. Journalize the adjusting entries to reflect items a through f above. 5. Post the adjusting entries to the appropriate accounts in the ledger. 6. Prepare an adjusted trial balance as of December 31, 2019. Check figure: $113,405. Consult your instructor if your adjusted trial balance does not balance before proceeding with the project. 7. Prepare the three basic financial statements in good form. See your accounting text for a good example of financial statement formatting. 8. Prepare an income statement for the three months ended December 31, 2019. 9. Prepare a statement of owner's equity for the three months ended December 31, 2019. 10. Prepare a balance sheet as of December 31, 2019. 11. Journalize and post the necessary closing entries for Scott Consulting. 12. Prepare a post-closing trial balance as of December 31, 2019. GENERAL JOURNAL 1 PAGE DATE ACCOUNT POST DEBIT CREDIT REF 2019 Oct Cash 101 45,000 Office Equipment Computer Equipment T. Scott, Capital 163 30,000 9,000 167 301 84,000 1 Prepaid Insurance Cash 128 2,220 101 2,220 2 Prepaid Rent 131 3,300 Cash 101 3,300 9 Computer Supplies Accounts Payable 126 2,545 201 2,545 16 Accounts Receivable Consulting Revenue 106 4,800 403 4,800 31 Wages Expense Cash 623 875 101 875 Mileage Expense Cash Nov 2 676 320 101 320 MacBook Air Casim Nov 2 Mileage Expense 676 320 Cash 101 320 5 Accounts Payable 201 2,545 Cash 101 2,545 8 Cash 101 4,800 Accounts Receivable 106 4,800 14 Cash Consulting Revenue 101 4,633 403 4,633 23 Accounts Receivable Consulting Revenue 106 5,208 5,208 30 T. Scott, Withdrawals 302 2,000 Cash 101 2,000 General Journal for Requirements 1, 4 & 11 GENERAL JOURNAL PAGE 2 DATE ACCOUNT POST REF DEBIT CREDIT 2019 December Transactions (20 points) Dec GENERAL JOURNAL PAGE 3. DATE ACCOUNT POST DEBIT CREDIT REF 2019 Adjusting Entries (17 points) Dec Closing Entries (10 points) Ledger for Requirements 2, 5, & 11 Note: Ledger includes all entries from the first two months of operations for Scott Consulting. Continue by posting the December transactions. 12 points Cash Acct. No. 101 Date Explanation PR Debit Credit Balance Oct. 1 J1 45,000 45,000 42,780 1 J1 2,220 3,300 2 J1 39,480 38,605 38,285 31 J1 875 Nov. 2 J1 320 J1 2,545 35,740 40,540 45,173 43,173 8 J1 4,800 14 J1 4,633 30 J1 2,000 cle Project Instructions Accounts Receivable Acct. No. 106 Date Explanation PR Debit Credit Balance Oct. 16 J1 4,800 4,800 Nov. 8 J1 4,800 23 J1 5,208 5,208 Computer Supplies Acct. No. 126 Date Explanation 9. PR Debit 2,545 Credit Balance Oct. J1 2,545 Prepaid Insurance Acct. No. 128 Date Explanation PR Debit Credit Balance 2,220 Oct. 1 J1 2,220 Page 7 of 15 Ledger (Continued) Explanation Prepaid Rent Acct. No. 131 Date PR Debit Credit Balance Oct. J1 3,300 3,300 Office Equipment Acct. No. 163 Date Explanation PR Debit Credit Balance Oct. 1 J1 30,000 30,000 Acct. No. 164 Accumulated Depreciation-Office Equipment Explanation Date PR Debit Credit Balance Computer Equipment PR Acct. No. 167 Date Explanation Debit Credit Balance Oct. 1 J1 9,000 9,000 Accumulated Depreciation-Computer Equipment Acct. No. 168 Date Explanation PR Debit Credit Balance Acct. No. 201 MacBook Air Acct. No. 201 Accounts Payable Date Explanation PR Debit Credit Balance Oct. J1 2,545 2,545 Nov. J1 2,545 Wages Payable Acct. No. 210 Date Explanation PR Debit Credit Balance Unearned Consulting Revenue Explanation Acct. No. 236 Date PR Debit Credit Balance 9 5 T. Scott, Capital Acct. No. 301 Date Explanation PR Debit Credit Balance Oct. 1 J1 84,000 84,000 T. Scott, Withdrawals Acct. No. 302 Date Explanation PR Debit Credit Balance Nov. 30 J1 2,000 2,000 Consulting Revenue Debit Acct. No. 403 Date Explanation PR Credit Balance Oct. 16 4,800 9,433 14,641 J1 4,800 Nov. 4,633 5,208 14 J1 23 J1 Depreciation Expense-Office Equipment Debit Acct. No. 612 Date Explanation PR Credit Balance Depreciation Expense-Computer Equipment Explanation Acct. No. 613 Balance Date PR Debit Credit Wages Expense Acct. No. 623 Date Explanation PR Debit Credit Balance Oct. 31 J1 875 875 Insurance Expense Acct. No. 637 Date Explanation PR Debit Credit Balance Rent Expense Acct. No. 640 Date Explanation PR Debit Credit Balance Computer Supplies Expense Acct. No. 652 Date Explanation PR Debit Credit Balance Advertising Expense Acct. No. 655 Date Explanation PR Debit Credit Balance Mileage Expense Acct. No. 676 Date Explanation PR Debit Credit Balance Nov. J1 320 320 Repairs Expense-Computer Explanation Acct. No. 684 Date PR Debit Credit Balance Income Summary Acct. No. 901 Date Explanation PR Debit Credit Balance Working Paper for Requirement 3 3 points Scott Consulting Trial Balance December 31, 2019 DEBIT CREDIT Working Paper for Requirement 6 3 points Scott Consulting Adjusted Trial Balance December 31, 2019 DEBIT CREDIT Working Papers for Requirements 7, 8 & 9 Scott Consulting Income Statement (10 points) For Three Months Ended December 31, 2019 Scott Consulting Statement of Owner's Equity (5 points) For Three Months Ended December 31, 2019 Working Papers for Requirements 6, 7 & 8 (continued) Scott Consulting Balance Sheet (10 points) December 31, 2019 Working Papers for Requirement 12 Scott Consulting Post-Closing Trial Balance December 31, 2019 DEBIT CREDIT Taylor Scott owns and operates a consulting firm called Scott Consulting. The business began operating in October 2019. Transactions for October and November 2019 have been recorded in the general journal and posted in the general ledger. Scott Consulting had the following transactions in December 2019. Dec 2 Purchased $2,200 of computer supplies on credit from Graham Office Products. 3 Completed a project for Olympus Corporation and received $6,425 cash. 4 Paid cash to employee for five days of work at the rate of $176 per day. 10 Provided $1,985 of consulting services to Nelson Company on account. 14 Notified by True Engineering Co. that Scott Consulting's bid of $6,750 on a proposed project has been accepted. True paid a $1,200 cash advance to Scott Consulting. 15 Paid $1,130 cash to Global Mall for Scott Consulting's share of mall advertising costs. 20 Paid $250 cash for minor repairs to the company's computer. 28 Received $500 cash from Nelson Company on its receivable. 29 Reimbursed T. Scott $87 for business automobile mileage. 31 T. Scott withdrew $1,200 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 of operations: a. The December 31 inventory count of computer supplies shows $2,290 still available. b. One of the four months' prepaid rent has expired. c. Two months have expired since the 12-month insurance premium was paid in advance. d. As of December 31, the only employee of Scott Consulting had not been paid for four days of work at $176 per day. e. The computer equipment, acquired for $9,000 on October 1, is expected to have a three-year life with no salvage value. f. The office equipment, acquired for $30,000 on October 1, is expected to have a five-year life with no salvage value. Required: 1. Journalize the December transactions for Scott Consulting. You may omit explanations for the journal entries. Skip a line between each journal entry - see the journal entries for October - November as a formatting example. 2. Post the December transactions to the appropriate accounts in the ledger. 3. Prepare a trial balance to prove the equality of debits and credits prior to continuing with this project. Omit any accounts that have a zero balance. Check figure: $110,451. Consult your instructor if your trial balance does not balance before proceeding with the project. 4. Journalize the adjusting entries to reflect items a through f above. 5. Post the adjusting entries to the appropriate accounts in the ledger. 6. Prepare an adjusted trial balance as of December 31, 2019. Check figure: $113,405. Consult your instructor if your adjusted trial balance does not balance before proceeding with the project. 7. Prepare the three basic financial statements in good form. See your accounting text for a good example of financial statement formatting. 8. Prepare an income statement for the three months ended December 31, 2019. 9. Prepare a statement of owner's equity for the three months ended December 31, 2019. 10. Prepare a balance sheet as of December 31, 2019. 11. Journalize and post the necessary closing entries for Scott Consulting. 12. Prepare a post-closing trial balance as of December 31, 2019. GENERAL JOURNAL 1 PAGE DATE ACCOUNT POST DEBIT CREDIT REF 2019 Oct Cash 101 45,000 Office Equipment Computer Equipment T. Scott, Capital 163 30,000 9,000 167 301 84,000 1 Prepaid Insurance Cash 128 2,220 101 2,220 2 Prepaid Rent 131 3,300 Cash 101 3,300 9 Computer Supplies Accounts Payable 126 2,545 201 2,545 16 Accounts Receivable Consulting Revenue 106 4,800 403 4,800 31 Wages Expense Cash 623 875 101 875 Mileage Expense Cash Nov 2 676 320 101 320 MacBook Air Casim Nov 2 Mileage Expense 676 320 Cash 101 320 5 Accounts Payable 201 2,545 Cash 101 2,545 8 Cash 101 4,800 Accounts Receivable 106 4,800 14 Cash Consulting Revenue 101 4,633 403 4,633 23 Accounts Receivable Consulting Revenue 106 5,208 5,208 30 T. Scott, Withdrawals 302 2,000 Cash 101 2,000 General Journal for Requirements 1, 4 & 11 GENERAL JOURNAL PAGE 2 DATE ACCOUNT POST REF DEBIT CREDIT 2019 December Transactions (20 points) Dec GENERAL JOURNAL PAGE 3. DATE ACCOUNT POST DEBIT CREDIT REF 2019 Adjusting Entries (17 points) Dec Closing Entries (10 points) Ledger for Requirements 2, 5, & 11 Note: Ledger includes all entries from the first two months of operations for Scott Consulting. Continue by posting the December transactions. 12 points Cash Acct. No. 101 Date Explanation PR Debit Credit Balance Oct. 1 J1 45,000 45,000 42,780 1 J1 2,220 3,300 2 J1 39,480 38,605 38,285 31 J1 875 Nov. 2 J1 320 J1 2,545 35,740 40,540 45,173 43,173 8 J1 4,800 14 J1 4,633 30 J1 2,000 cle Project Instructions Accounts Receivable Acct. No. 106 Date Explanation PR Debit Credit Balance Oct. 16 J1 4,800 4,800 Nov. 8 J1 4,800 23 J1 5,208 5,208 Computer Supplies Acct. No. 126 Date Explanation 9. PR Debit 2,545 Credit Balance Oct. J1 2,545 Prepaid Insurance Acct. No. 128 Date Explanation PR Debit Credit Balance 2,220 Oct. 1 J1 2,220 Page 7 of 15 Ledger (Continued) Explanation Prepaid Rent Acct. No. 131 Date PR Debit Credit Balance Oct. J1 3,300 3,300 Office Equipment Acct. No. 163 Date Explanation PR Debit Credit Balance Oct. 1 J1 30,000 30,000 Acct. No. 164 Accumulated Depreciation-Office Equipment Explanation Date PR Debit Credit Balance Computer Equipment PR Acct. No. 167 Date Explanation Debit Credit Balance Oct. 1 J1 9,000 9,000 Accumulated Depreciation-Computer Equipment Acct. No. 168 Date Explanation PR Debit Credit Balance Acct. No. 201 MacBook Air Acct. No. 201 Accounts Payable Date Explanation PR Debit Credit Balance Oct. J1 2,545 2,545 Nov. J1 2,545 Wages Payable Acct. No. 210 Date Explanation PR Debit Credit Balance Unearned Consulting Revenue Explanation Acct. No. 236 Date PR Debit Credit Balance 9 5 T. Scott, Capital Acct. No. 301 Date Explanation PR Debit Credit Balance Oct. 1 J1 84,000 84,000 T. Scott, Withdrawals Acct. No. 302 Date Explanation PR Debit Credit Balance Nov. 30 J1 2,000 2,000 Consulting Revenue Debit Acct. No. 403 Date Explanation PR Credit Balance Oct. 16 4,800 9,433 14,641 J1 4,800 Nov. 4,633 5,208 14 J1 23 J1 Depreciation Expense-Office Equipment Debit Acct. No. 612 Date Explanation PR Credit Balance Depreciation Expense-Computer Equipment Explanation Acct. No. 613 Balance Date PR Debit Credit Wages Expense Acct. No. 623 Date Explanation PR Debit Credit Balance Oct. 31 J1 875 875 Insurance Expense Acct. No. 637 Date Explanation PR Debit Credit Balance Rent Expense Acct. No. 640 Date Explanation PR Debit Credit Balance Computer Supplies Expense Acct. No. 652 Date Explanation PR Debit Credit Balance Advertising Expense Acct. No. 655 Date Explanation PR Debit Credit Balance Mileage Expense Acct. No. 676 Date Explanation PR Debit Credit Balance Nov. J1 320 320 Repairs Expense-Computer Explanation Acct. No. 684 Date PR Debit Credit Balance Income Summary Acct. No. 901 Date Explanation PR Debit Credit Balance Working Paper for Requirement 3 3 points Scott Consulting Trial Balance December 31, 2019 DEBIT CREDIT Working Paper for Requirement 6 3 points Scott Consulting Adjusted Trial Balance December 31, 2019 DEBIT CREDIT Working Papers for Requirements 7, 8 & 9 Scott Consulting Income Statement (10 points) For Three Months Ended December 31, 2019 Scott Consulting Statement of Owner's Equity (5 points) For Three Months Ended December 31, 2019 Working Papers for Requirements 6, 7 & 8 (continued) Scott Consulting Balance Sheet (10 points) December 31, 2019 Working Papers for Requirement 12 Scott Consulting Post-Closing Trial Balance December 31, 2019 DEBIT CREDIT Taylor Scott owns and operates a consulting firm called Scott Consulting. The business began operating in October 2019. Transactions for October and November 2019 have been recorded in the general journal and posted in the general ledger. Scott Consulting had the following transactions in December 2019. Dec 2 Purchased $2,200 of computer supplies on credit from Graham Office Products. 3 Completed a project for Olympus Corporation and received $6,425 cash. 4 Paid cash to employee for five days of work at the rate of $176 per day. 10 Provided $1,985 of consulting services to Nelson Company on account. 14 Notified by True Engineering Co. that Scott Consulting's bid of $6,750 on a proposed project has been accepted. True paid a $1,200 cash advance to Scott Consulting. 15 Paid $1,130 cash to Global Mall for Scott Consulting's share of mall advertising costs. 20 Paid $250 cash for minor repairs to the company's computer. 28 Received $500 cash from Nelson Company on its receivable. 29 Reimbursed T. Scott $87 for business automobile mileage. 31 T. Scott withdrew $1,200 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 of operations: a. The December 31 inventory count of computer supplies shows $2,290 still available. b. One of the four months' prepaid rent has expired. c. Two months have expired since the 12-month insurance premium was paid in advance. d. As of December 31, the only employee of Scott Consulting had not been paid for four days of work at $176 per day. e. The computer equipment, acquired for $9,000 on October 1, is expected to have a three-year life with no salvage value. f. The office equipment, acquired for $30,000 on October 1, is expected to have a five-year life with no salvage value. Required: 1. Journalize the December transactions for Scott Consulting. You may omit explanations for the journal entries. Skip a line between each journal entry - see the journal entries for October - November as a formatting example. 2. Post the December transactions to the appropriate accounts in the ledger. 3. Prepare a trial balance to prove the equality of debits and credits prior to continuing with this project. Omit any accounts that have a zero balance. Check figure: $110,451. Consult your instructor if your trial balance does not balance before proceeding with the project. 4. Journalize the adjusting entries to reflect items a through f above. 5. Post the adjusting entries to the appropriate accounts in the ledger. 6. Prepare an adjusted trial balance as of December 31, 2019. Check figure: $113,405. Consult your instructor if your adjusted trial balance does not balance before proceeding with the project. 7. Prepare the three basic financial statements in good form. See your accounting text for a good example of financial statement formatting. 8. Prepare an income statement for the three months ended December 31, 2019. 9. Prepare a statement of owner's equity for the three months ended December 31, 2019. 10. Prepare a balance sheet as of December 31, 2019. 11. Journalize and post the necessary closing entries for Scott Consulting. 12. Prepare a post-closing trial balance as of December 31, 2019. GENERAL JOURNAL 1 PAGE DATE ACCOUNT POST DEBIT CREDIT REF 2019 Oct Cash 101 45,000 Office Equipment Computer Equipment T. Scott, Capital 163 30,000 9,000 167 301 84,000 1 Prepaid Insurance Cash 128 2,220 101 2,220 2 Prepaid Rent 131 3,300 Cash 101 3,300 9 Computer Supplies Accounts Payable 126 2,545 201 2,545 16 Accounts Receivable Consulting Revenue 106 4,800 403 4,800 31 Wages Expense Cash 623 875 101 875 Mileage Expense Cash Nov 2 676 320 101 320 MacBook Air Casim Nov 2 Mileage Expense 676 320 Cash 101 320 5 Accounts Payable 201 2,545 Cash 101 2,545 8 Cash 101 4,800 Accounts Receivable 106 4,800 14 Cash Consulting Revenue 101 4,633 403 4,633 23 Accounts Receivable Consulting Revenue 106 5,208 5,208 30 T. Scott, Withdrawals 302 2,000 Cash 101 2,000 General Journal for Requirements 1, 4 & 11 GENERAL JOURNAL PAGE 2 DATE ACCOUNT POST REF DEBIT CREDIT 2019 December Transactions (20 points) Dec GENERAL JOURNAL PAGE 3. DATE ACCOUNT POST DEBIT CREDIT REF 2019 Adjusting Entries (17 points) Dec Closing Entries (10 points) Ledger for Requirements 2, 5, & 11 Note: Ledger includes all entries from the first two months of operations for Scott Consulting. Continue by posting the December transactions. 12 points Cash Acct. No. 101 Date Explanation PR Debit Credit Balance Oct. 1 J1 45,000 45,000 42,780 1 J1 2,220 3,300 2 J1 39,480 38,605 38,285 31 J1 875 Nov. 2 J1 320 J1 2,545 35,740 40,540 45,173 43,173 8 J1 4,800 14 J1 4,633 30 J1 2,000 cle Project Instructions Accounts Receivable Acct. No. 106 Date Explanation PR Debit Credit Balance Oct. 16 J1 4,800 4,800 Nov. 8 J1 4,800 23 J1 5,208 5,208 Computer Supplies Acct. No. 126 Date Explanation 9. PR Debit 2,545 Credit Balance Oct. J1 2,545 Prepaid Insurance Acct. No. 128 Date Explanation PR Debit Credit Balance 2,220 Oct. 1 J1 2,220 Page 7 of 15 Ledger (Continued) Explanation Prepaid Rent Acct. No. 131 Date PR Debit Credit Balance Oct. J1 3,300 3,300 Office Equipment Acct. No. 163 Date Explanation PR Debit Credit Balance Oct. 1 J1 30,000 30,000 Acct. No. 164 Accumulated Depreciation-Office Equipment Explanation Date PR Debit Credit Balance Computer Equipment PR Acct. No. 167 Date Explanation Debit Credit Balance Oct. 1 J1 9,000 9,000 Accumulated Depreciation-Computer Equipment Acct. No. 168 Date Explanation PR Debit Credit Balance Acct. No. 201 MacBook Air Acct. No. 201 Accounts Payable Date Explanation PR Debit Credit Balance Oct. J1 2,545 2,545 Nov. J1 2,545 Wages Payable Acct. No. 210 Date Explanation PR Debit Credit Balance Unearned Consulting Revenue Explanation Acct. No. 236 Date PR Debit Credit Balance 9 5 T. Scott, Capital Acct. No. 301 Date Explanation PR Debit Credit Balance Oct. 1 J1 84,000 84,000 T. Scott, Withdrawals Acct. No. 302 Date Explanation PR Debit Credit Balance Nov. 30 J1 2,000 2,000 Consulting Revenue Debit Acct. No. 403 Date Explanation PR Credit Balance Oct. 16 4,800 9,433 14,641 J1 4,800 Nov. 4,633 5,208 14 J1 23 J1 Depreciation Expense-Office Equipment Debit Acct. No. 612 Date Explanation PR Credit Balance Depreciation Expense-Computer Equipment Explanation Acct. No. 613 Balance Date PR Debit Credit Wages Expense Acct. No. 623 Date Explanation PR Debit Credit Balance Oct. 31 J1 875 875 Insurance Expense Acct. No. 637 Date Explanation PR Debit Credit Balance Rent Expense Acct. No. 640 Date Explanation PR Debit Credit Balance Computer Supplies Expense Acct. No. 652 Date Explanation PR Debit Credit Balance Advertising Expense Acct. No. 655 Date Explanation PR Debit Credit Balance Mileage Expense Acct. No. 676 Date Explanation PR Debit Credit Balance Nov. J1 320 320 Repairs Expense-Computer Explanation Acct. No. 684 Date PR Debit Credit Balance Income Summary Acct. No. 901 Date Explanation PR Debit Credit Balance Working Paper for Requirement 3 3 points Scott Consulting Trial Balance December 31, 2019 DEBIT CREDIT Working Paper for Requirement 6 3 points Scott Consulting Adjusted Trial Balance December 31, 2019 DEBIT CREDIT Working Papers for Requirements 7, 8 & 9 Scott Consulting Income Statement (10 points) For Three Months Ended December 31, 2019 Scott Consulting Statement of Owner's Equity (5 points) For Three Months Ended December 31, 2019 Working Papers for Requirements 6, 7 & 8 (continued) Scott Consulting Balance Sheet (10 points) December 31, 2019 Working Papers for Requirement 12 Scott Consulting Post-Closing Trial Balance December 31, 2019 DEBIT CREDIT Taylor Scott owns and operates a consulting firm called Scott Consulting. The business began operating in October 2019. Transactions for October and November 2019 have been recorded in the general journal and posted in the general ledger. Scott Consulting had the following transactions in December 2019. Dec 2 Purchased $2,200 of computer supplies on credit from Graham Office Products. 3 Completed a project for Olympus Corporation and received $6,425 cash. 4 Paid cash to employee for five days of work at the rate of $176 per day. 10 Provided $1,985 of consulting services to Nelson Company on account. 14 Notified by True Engineering Co. that Scott Consulting's bid of $6,750 on a proposed project has been accepted. True paid a $1,200 cash advance to Scott Consulting. 15 Paid $1,130 cash to Global Mall for Scott Consulting's share of mall advertising costs. 20 Paid $250 cash for minor repairs to the company's computer. 28 Received $500 cash from Nelson Company on its receivable. 29 Reimbursed T. Scott $87 for business automobile mileage. 31 T. Scott withdrew $1,200 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 of operations: a. The December 31 inventory count of computer supplies shows $2,290 still available. b. One of the four months' prepaid rent has expired. c. Two months have expired since the 12-month insurance premium was paid in advance. d. As of December 31, the only employee of Scott Consulting had not been paid for four days of work at $176 per day. e. The computer equipment, acquired for $9,000 on October 1, is expected to have a three-year life with no salvage value. f. The office equipment, acquired for $30,000 on October 1, is expected to have a five-year life with no salvage value. Required: 1. Journalize the December transactions for Scott Consulting. You may omit explanations for the journal entries. Skip a line between each journal entry - see the journal entries for October - November as a formatting example. 2. Post the December transactions to the appropriate accounts in the ledger. 3. Prepare a trial balance to prove the equality of debits and credits prior to continuing with this project. Omit any accounts that have a zero balance. Check figure: $110,451. Consult your instructor if your trial balance does not balance before proceeding with the project. 4. Journalize the adjusting entries to reflect items a through f above. 5. Post the adjusting entries to the appropriate accounts in the ledger. 6. Prepare an adjusted trial balance as of December 31, 2019. Check figure: $113,405. Consult your instructor if your adjusted trial balance does not balance before proceeding with the project. 7. Prepare the three basic financial statements in good form. See your accounting text for a good example of financial statement formatting. 8. Prepare an income statement for the three months ended December 31, 2019. 9. Prepare a statement of owner's equity for the three months ended December 31, 2019. 10. Prepare a balance sheet as of December 31, 2019. 11. Journalize and post the necessary closing entries for Scott Consulting. 12. Prepare a post-closing trial balance as of December 31, 2019. GENERAL JOURNAL 1 PAGE DATE ACCOUNT POST DEBIT CREDIT REF 2019 Oct Cash 101 45,000 Office Equipment Computer Equipment T. Scott, Capital 163 30,000 9,000 167 301 84,000 1 Prepaid Insurance Cash 128 2,220 101 2,220 2 Prepaid Rent 131 3,300 Cash 101 3,300 9 Computer Supplies Accounts Payable 126 2,545 201 2,545 16 Accounts Receivable Consulting Revenue 106 4,800 403 4,800 31 Wages Expense Cash 623 875 101 875 Mileage Expense Cash Nov 2 676 320 101 320 MacBook Air Casim Nov 2 Mileage Expense 676 320 Cash 101 320 5 Accounts Payable 201 2,545 Cash 101 2,545 8 Cash 101 4,800 Accounts Receivable 106 4,800 14 Cash Consulting Revenue 101 4,633 403 4,633 23 Accounts Receivable Consulting Revenue 106 5,208 5,208 30 T. Scott, Withdrawals 302 2,000 Cash 101 2,000 General Journal for Requirements 1, 4 & 11 GENERAL JOURNAL PAGE 2 DATE ACCOUNT POST REF DEBIT CREDIT 2019 December Transactions (20 points) Dec GENERAL JOURNAL PAGE 3. DATE ACCOUNT POST DEBIT CREDIT REF 2019 Adjusting Entries (17 points) Dec Closing Entries (10 points) Ledger for Requirements 2, 5, & 11 Note: Ledger includes all entries from the first two months of operations for Scott Consulting. Continue by posting the December transactions. 12 points Cash Acct. No. 101 Date Explanation PR Debit Credit Balance Oct. 1 J1 45,000 45,000 42,780 1 J1 2,220 3,300 2 J1 39,480 38,605 38,285 31 J1 875 Nov. 2 J1 320 J1 2,545 35,740 40,540 45,173 43,173 8 J1 4,800 14 J1 4,633 30 J1 2,000 cle Project Instructions Accounts Receivable Acct. No. 106 Date Explanation PR Debit Credit Balance Oct. 16 J1 4,800 4,800 Nov. 8 J1 4,800 23 J1 5,208 5,208 Computer Supplies Acct. No. 126 Date Explanation 9. PR Debit 2,545 Credit Balance Oct. J1 2,545 Prepaid Insurance Acct. No. 128 Date Explanation PR Debit Credit Balance 2,220 Oct. 1 J1 2,220 Page 7 of 15 Ledger (Continued) Explanation Prepaid Rent Acct. No. 131 Date PR Debit Credit Balance Oct. J1 3,300 3,300 Office Equipment Acct. No. 163 Date Explanation PR Debit Credit Balance Oct. 1 J1 30,000 30,000 Acct. No. 164 Accumulated Depreciation-Office Equipment Explanation Date PR Debit Credit Balance Computer Equipment PR Acct. No. 167 Date Explanation Debit Credit Balance Oct. 1 J1 9,000 9,000 Accumulated Depreciation-Computer Equipment Acct. No. 168 Date Explanation PR Debit Credit Balance Acct. No. 201 MacBook Air Acct. No. 201 Accounts Payable Date Explanation PR Debit Credit Balance Oct. J1 2,545 2,545 Nov. J1 2,545 Wages Payable Acct. No. 210 Date Explanation PR Debit Credit Balance Unearned Consulting Revenue Explanation Acct. No. 236 Date PR Debit Credit Balance 9 5 T. Scott, Capital Acct. No. 301 Date Explanation PR Debit Credit Balance Oct. 1 J1 84,000 84,000 T. Scott, Withdrawals Acct. No. 302 Date Explanation PR Debit Credit Balance Nov. 30 J1 2,000 2,000 Consulting Revenue Debit Acct. No. 403 Date Explanation PR Credit Balance Oct. 16 4,800 9,433 14,641 J1 4,800 Nov. 4,633 5,208 14 J1 23 J1 Depreciation Expense-Office Equipment Debit Acct. No. 612 Date Explanation PR Credit Balance Depreciation Expense-Computer Equipment Explanation Acct. No. 613 Balance Date PR Debit Credit Wages Expense Acct. No. 623 Date Explanation PR Debit Credit Balance Oct. 31 J1 875 875 Insurance Expense Acct. No. 637 Date Explanation PR Debit Credit Balance Rent Expense Acct. No. 640 Date Explanation PR Debit Credit Balance Computer Supplies Expense Acct. No. 652 Date Explanation PR Debit Credit Balance Advertising Expense Acct. No. 655 Date Explanation PR Debit Credit Balance Mileage Expense Acct. No. 676 Date Explanation PR Debit Credit Balance Nov. J1 320 320 Repairs Expense-Computer Explanation Acct. No. 684 Date PR Debit Credit Balance Income Summary Acct. No. 901 Date Explanation PR Debit Credit Balance Working Paper for Requirement 3 3 points Scott Consulting Trial Balance December 31, 2019 DEBIT CREDIT Working Paper for Requirement 6 3 points Scott Consulting Adjusted Trial Balance December 31, 2019 DEBIT CREDIT Working Papers for Requirements 7, 8 & 9 Scott Consulting Income Statement (10 points) For Three Months Ended December 31, 2019 Scott Consulting Statement of Owner's Equity (5 points) For Three Months Ended December 31, 2019 Working Papers for Requirements 6, 7 & 8 (continued) Scott Consulting Balance Sheet (10 points) December 31, 2019 Working Papers for Requirement 12 Scott Consulting Post-Closing Trial Balance December 31, 2019 DEBIT CREDIT