This problem is based on the transactions for the Kitchen Solutions Company in your text. Prepare journal entries for each transaction and identify the financial statement impact of each entry. The financial statements are automatically generated based on the journal entries recorded. December 1 On December 1, James Drake forms a consulting business, named Kitchen Solutions, Kitchen Solutions receives 578 , eae cash from Janes Drake in exchange for comon stock. December 2 Kitchen Solutions pays $4,990 cash for supplies. The conpany's policy is to record all prepaid expenses in asset accounts: December 3 Kitchen Solutions pays $62,00 eash for equipment. December 4 Kitchen Solutions purchases $10,750 of supplies on credit from a supplier, Caltech Supply. Decenber 5 Kitchen Solutions provides consulting services and immediately collects $6,600 cash. December 6 Kitchen Solutions pays $3,400 cash for December rent. December 7 Kitchen Solutions pays $1,909 cash for employee salary. December 8 Kitchen Solutions provides consulting services of $5,300 and rents its test facilities for $4,600. The custoner is billed $9,300 for these services. December 9 Kitchen 50 lutions receives $9,360 cash from the client billed on December 8. Decenber 10 Kitchen. Solutions pays CalTech Supply $3,300 cash as partial paynent for its Decenber 4.$10,75 purchase of supplies. Decenber 11 Kitchen Solutions pays $1, tee cash for dividends. Decenber 12 Kitchen Solutions receives $4,600 cash in advance of providing consulting services to a customer. The conpany's policy Decenber 13 Kitchen Solutions pallected in advance in a balance sheet account. The company's policy is $4,8e cash (insurance premiun) for a 24 -month insurance policy. Coverage begins on Cecenber 1. Decenber 14 Kitchen Solutions pays $2,520 cash for supplies. Decenber 15 Kitchen Solutions pays \$2, 7as cash for Docenber utilities expense. Decenber 16 Kitchen Solutions pays \$1,90e cash in enployee salary for work perforned in the lat.jer part of Decenber. Every journal entry must keep the accounting equation in balance. Prepare the journal entries for each of the transactions of the Kitchen Solutions Company, entering the debits before the credits, Each transaction will automatically be posted to the General Ledger and the Trial Balance as soon as you click "Record Entry". Every journal entry must keep the accounting equation in balance. Prepare the journal entries for each of the transactions of the Kitchen Solutions Company, entering the debits before the credits. Each transaction will automatically be posted to the General Ledger and the Trial Balance as soon as you click "Record Entry". Journal entry worksheet On December 1, James Drake forms a consulting business, named Kitchen Solutions, Kitchen Solutions receives $78,000 cash from James Drake in exchange for common stock. Noter Enter debits before credits. December 15 Kitchen Solutions pays $2,705 cash for December utilities expense. December 16 Kitchen Solutions pays $1,900 cash in employee salary for work performed in the latter part of Dececber. An income statement reports the changes in equity attributable to the operation of the business during a specific time period. Revenues increase equity, and expenses decrease equity. Net income or loss is transferred from the income statement to the: December 10 Kitchen Solutions pays CalTech Supply $3,300 cash as partial payment for its December 4 \$10, 750 purchase December 11 Kitchen Solutions pays $1,800 cash for dividends. December 12 Kitchen Solutions receives $4,600 cash in advance of providing consulting services to a customer. The com. is to record fees collected in advance in a balance sheet account. December 13 Kitchen Solutions pays $4,800 cash (insurance premium) for a 24 -month insurance policy. Coverage begins or The company's policy is to record all prepaid expenses in a balance sheet account. December 14 Kitchen Solutions pays $2,52 cash for supplies. December 15 Kitchen Solutions pays $2,70 cash for December utilities expense. December 16 Kitchen Solutions pays $1,900 cash in employee salary for work performed in the latter part of December. Review the statement of retained earnings and indicate how the statement is linked to the other financial statements. The balance sheet is the accounting equation: Assets = Liabilities + Equity. Each asset and liability account is reported separately on the balance sheet. Equity includes common stock and the ending retained earnings amount from the Stateme of Retained Earnings. Show less A \begin{tabular}{|c|c|c|c|c|} \hline Transaction: & Net Income & Total Assets & \begin{tabular}{l} Total \\ Liabilities \end{tabular} & Total Equity \\ \hline \multicolumn{5}{|l|}{ Where can you go to find each of your answers? } \\ \hline \begin{tabular}{l} December 1 - Kitchen Solutions receives $78,000 cash \\ from James Drake in exchange for common stock. \end{tabular} & $ & 78,000 & $ & 78.000 \\ \hline December 2 - Pays $4,900 cash for supplies. & 0 & 78,000 & 0 & 78,000 \\ \hline December 3 - Pays $62,000 cash for equipment. & 0 & 78,000 & 0 & 78,000 \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 4 - Purchases $10,750 of supplies on credit \\ from a supplior. \end{tabular}} \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 5 - Provides consulting services and \\ immediately collects $6.600 cash. \end{tabular}} \\ \hline December 6 - Pays $3,400 cash for December rent. & , & & & \\ \hline \multicolumn{5}{|l|}{ December 7 - Pays $1,900 cash for employee salary. } \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 8 - Provides consulting services of $5,300 \\ and rents its test facilities for $4,000. The customer is \\ billed $9,300 for these services. \end{tabular}} \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 9 - Receives $9,300 cash from the client \\ billed on December 8 . \end{tabular}} \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 10 - Pays CalTech Supply $3,300 cash \\ toward the payable from December 4 . \end{tabular}} \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 11 - Kitchen Solutions pays $1,800 cash for \\ dividends. \end{tabular}} \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 12 - Receives $4,600 cash in advance of \\ providing consulting services to a customer. \end{tabular}} \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 13 - Pays $4,800 cash (insurance premium) \\ for a 24month insurance policy. Coverage begins on \\ December 1 . \end{tabular}} \\ \hline \multicolumn{5}{|l|}{ December 14 - Pays $2,520 cash for supplies. } \\ \hline \multicolumn{5}{|l|}{\begin{tabular}{l} December 15 - Pays $2,705 cash for December utilities \\ expense. \end{tabular}} \\ \hline \begin{tabular}{l} December 16 - Pays $1,900 cash in employee salary for \\ work performed in the latter part of December. \end{tabular} & & & & \\ \hline \end{tabular}