The November 30, 2020. unadjusted trial balance of Business Solutions is found in the Trial balance tab Business Solutions had the following transactions and events in December 2020. Dec. 2 Paid $1,025 cash to Hillside wall for Business Solutions share of mall advertising costs. Dec. 3 Paid $500 cash for minor repairs to the company's computer. Dec. 4 Received $3,950 cash from Alex's Engineering Co. for the receivable from November. Dec. 10 Paid cash to Lyn Addie for six days of work at the rate of $125 per day. Deo. 14 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. Dec. 15 Purchased 1,100 of computer supplies on credit from Harris office Products Doc. 16 Sent a reminder to Gomez Co. to pay the fee for services recorded on November 3. Dec. 20 Completed a project for Liu Corporation and received $5,625 cash. Dec. 22- Took the week oft for the holidays. 26 Dec 28 Received $3,000 cash from Comes Co. on its receivable. Dec. 29 Reimbursed S. Rey for business automobile mileage (600 miles at $0.32 per mile). Dec. 31 The company paid $1.500 cash in dividende. The following additional facts are collected for use in making adjusting entries prior to preparing financial statements for the company's first three months: a. The December 31 inventory count of computer supplies shows $580 still available b. Three months have expired since the 12-month insurance premium was paid in advance c. As of December 31, Lyn Addle has not been paid for four days of work at $125 per day d. The computer system, acquired on October 1, is expected to have a four year life with no salvage value e. The office equipment, acquired on October 1, is expected to have a five-year life with no salvage value. 1. Three of the four months' prepaid rent has expired. Requirement General Journal General Ledger Trial Balance Income Statement St Retained Earnings Balance Sheet Impact on Income Prepare journal entries for each of the December transactions. If no journal entry is required, select "No journal entry required" in the first account field. Then, using the 3-step adjusting entry process, and the information given for adjustments, prepare the adjusting entry necessary to correctly report the revenue earned or the expense incurred. After adjusting the accounts, review the general ledger and trial balance for accuracy. Show less No Date Account Title Debit Credit 1 Dec 02 Advertising expense Cash 1.025 Olo 1,025 2 Dec 03 Repairs expense - Computer Cash O 500 500 3 Dec 04 Cash Accounts receivable 3,950 3,950 Dec 10 Wages expense Cash > 750 > 750 5 Dec 14 1,500 Cash Uneamed computer services revenue 90 1,500 Dec 29 Mileage expense Cash 192 > 192 Dec 31 Dividends Cash 1,500 1,500 Dec 31 > Computer supplies expense Computer supplies 3,065 3,065 Dec 31 Insurance expense Prepaid insurance 9 555 555 Dec 31 Wages expense Wages payable 500 500 Dec 31 1.250 Depreciation expense - Computer equipment Accumulated depreciation - Computer equipment IS 1.250 Dec 31 > 400 Depreciation expense - Office equipment Accumulated depreciation - Office equipment 400 Dec 31 2,475 Rent expense Prepaid rent 2,475 Adjusted BUSINESS SOLUTIONS Income Statement For Three Months Ended December 31, 2020 Revenues: Computer services revenue 31,284 0 $ 31,284 400 >> Total revenues Expenses: Depreciation expense - Office equipment Depreciation expense - Computer equipment Wages expense Insurance expense Rent expense Computer supplies expense Advertising expense Mileage expense Miscellanous expenses Repairs expense - Computer + 1,250 3,875 555 2,475 3,065 2,753 896 OOO 250 1,305 0 Total expenses Net income 16,824 14,460 IS C. As of December 31, Lyn Addie has not been paid for tour days of work at $125 per day. d. The computer system, acquired on October 1, is expected to have a four-year life with no e. The office equipment, acquired on October 1, is expected to have a five-year life with no f. Three of the four months' prepaid rent has expired. Requirement General Journal General Ledger Trial Balance Income Statement St Retained Earnings Balance S The unadjusted or adjusted balances will appear for each account, based on your selection. Adjusted BUSINESS SOLUTIONS Statement of Retained Earnings For Three Months Ended December 31, 2020 Retained earnings, October 1, 2020 $ Add: Net Income Less: Dividends Retained earnings, December 31, 2020 $ 0 14,460 (7.100) 7,360 Income Statement Balance Sheet Adjusted BUSINESS SOLUTIONS Balance Sheet December 31, 2020 ASSETS $ Current assets: Cash Accounts receivable Computer supplies Prepaid insurance Prepaid rent 48,372 5,668 580 1,665 825 0 Total current assets $ 57,110 8,000 (400) 7,600 Plant assets: Office equipment Accumulated depreciation - Office equipment Office equipment, net Computer equipment Accumulated depreciation - Computer equipment Computer equipment, net Total plant assets Total assets 20,000 (1,250) 18,750 26,350 83,460 $ HANYA SIRPARTY w 10 1 57,110 8,000 (400) Total current assets Plant assets: Office equipment Accumulated depreciation - Office equipment Office equipment, net Computer equipment Accumulated depreciation - Computer equipment Computer equipment, net Total plant assets Total assets 7,600 20,000 (1.250) 18.750 26,350 83,460 $ LIABILITIES AND EQUITY Liabilities: Accounts payable Wages payable Uneamed computer services revenue 1,100 500 1,500 0 Total liabilities 3.100 Equity Common stock Retained earnings Total equity Total liabilities and equity 73,000 7,360 80,360 83,460 Show less Adjusted Impact on net income Adjusting entry related to: a) Computer supplies b) Prepaid insurance $ (3,065) (555) c) Accrued wages Account affecting the Income Statement Balance Sheet Computer supplies expense Computer supplies Insurance expense Prepaid insurance Wages expenso Wages payable Depreciation expense- Accumulated depreciation - Computer equipment Computer equipment Depreciation expense - Office Accumulated depreciation equipment Office equipment Rent expense Prepaid rent (500) (1.250) d) Depreciation - Computer equipment .) Depreciation Office equipment Prepaid rent Total impact on income due to adjustments Net Income before adjustments (400) (2,475) (8,245) $ $ Had the adjustments not been prepared, Income would have been overstated by (8,245) (100.0% 750 > 750 5 Dec 14 1,500 Cash Uneamed computer services revenue 90 1,500 Dec 29 Mileage expense Cash 192 > 192 Dec 31 Dividends Cash 1,500 1,500 Dec 31 > Computer supplies expense Computer supplies 3,065 3,065 Dec 31 Insurance expense Prepaid insurance 9 555 555 Dec 31 Wages expense Wages payable 500 500 Dec 31 1.250 Depreciation expense - Computer equipment Accumulated depreciation - Computer equipment IS 1.250 Dec 31 > 400 Depreciation expense - Office equipment Accumulated depreciation - Office equipment 400 Dec 31 2,475 Rent expense Prepaid rent 2,475 Adjusted BUSINESS SOLUTIONS Income Statement For Three Months Ended December 31, 2020 Revenues: Computer services revenue 31,284 0 $ 31,284 400 >> Total revenues Expenses: Depreciation expense - Office equipment Depreciation expense - Computer equipment Wages expense Insurance expense Rent expense Computer supplies expense Advertising expense Mileage expense Miscellanous expenses Repairs expense - Computer + 1,250 3,875 555 2,475 3,065 2,753 896 OOO 250 1,305 0 Total expenses Net income 16,824 14,460 IS C. As of December 31, Lyn Addie has not been paid for tour days of work at $125 per day. d. The computer system, acquired on October 1, is expected to have a four-year life with no e. The office equipment, acquired on October 1, is expected to have a five-year life with no f. Three of the four months' prepaid rent has expired. Requirement General Journal General Ledger Trial Balance Income Statement St Retained Earnings Balance S The unadjusted or adjusted balances will appear for each account, based on your selection. Adjusted BUSINESS SOLUTIONS Statement of Retained Earnings For Three Months Ended December 31, 2020 Retained earnings, October 1, 2020 $ Add: Net Income Less: Dividends Retained earnings, December 31, 2020 $ 0 14,460 (7.100) 7,360 Income Statement Balance Sheet Adjusted BUSINESS SOLUTIONS Balance Sheet December 31, 2020 ASSETS $ Current assets: Cash Accounts receivable Computer supplies Prepaid insurance Prepaid rent 48,372 5,668 580 1,665 825 0 Total current assets $ 57,110 8,000 (400) 7,600 Plant assets: Office equipment Accumulated depreciation - Office equipment Office equipment, net Computer equipment Accumulated depreciation - Computer equipment Computer equipment, net Total plant assets Total assets 20,000 (1,250) 18,750 26,350 83,460 $ HANYA SIRPARTY w 10 1 57,110 8,000 (400) Total current assets Plant assets: Office equipment Accumulated depreciation - Office equipment Office equipment, net Computer equipment Accumulated depreciation - Computer equipment Computer equipment, net Total plant assets Total assets 7,600 20,000 (1.250) 18.750 26,350 83,460 $ LIABILITIES AND EQUITY Liabilities: Accounts payable Wages payable Uneamed computer services revenue 1,100 500 1,500 0 Total liabilities 3.100 Equity Common stock Retained earnings Total equity Total liabilities and equity 73,000 7,360 80,360 83,460 Show less Adjusted Impact on net income Adjusting entry related to: a) Computer supplies b) Prepaid insurance $ (3,065) (555) c) Accrued wages Account affecting the Income Statement Balance Sheet Computer supplies expense Computer supplies Insurance expense Prepaid insurance Wages expenso Wages payable Depreciation expense- Accumulated depreciation - Computer equipment Computer equipment Depreciation expense - Office Accumulated depreciation equipment Office equipment Rent expense Prepaid rent (500) (1.250) d) Depreciation - Computer equipment .) Depreciation Office equipment Prepaid rent Total impact on income due to adjustments Net Income before adjustments (400) (2,475) (8,245) $ $ Had the adjustments not been prepared, Income would have been overstated by (8,245) (100.0%