50.1K

Verified Solution

Link Copied!

Business Solutions had the following transactions and events in December 2015. After the success of the companys first two months, Santana Rey continues to operate Business Solutions. The November 30, 2015, unadjusted trial balance of Business Solutions (reflecting its transactions for October and November of 2015) follows. No. Account Title Debit Credit 101 Cash $ 38,664 106 Accounts receivable 13,218 126 Computer supplies 2,545 128 Prepaid insurance 1,920 131 Prepaid rent 3,160 163 Office equipment 8,200 164 Accumulated depreciationOffice equipment $ 0 167 Computer equipment 22,000 168 Accumulated depreciationComputer equipment 0 201 Accounts payable 0 210 Wages payable 0 236 Unearned computer services revenue 0 307 Common stock 71,000 318 Retained earnings 0 319 Dividends 6,400 403 Computer services revenue 30,849 612 Depreciation expenseOffice equipment 0 613 Depreciation expenseComputer equipment 0 623 Wages expense 2,475 637 Insurance expense 0 640 Rent expense 0 652 Computer supplies expense 0 655 Advertising expense 1,708 676 Mileage expense 604 677 Miscellaneous expenses 230 684 Repairs expenseComputer 725 Totals $ 101,849 $ 101,849
Dec.	2	Paid $965 cash to Hillside Mall for Business Solutions share of mall advertising costs.
	3	Paid $480 cash for minor repairs to the companys computer.
	4	Received $4,250 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 $105 per day.
	14	Notified by Alexs Engineering Co. that Business Solutions bid of $7,300 on a proposed project has been accepted. Alexs paid a $2,200 cash advance to Business Solutions.
	15	Purchased $1,200 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 $6,175 cash.
	2226	Took the week off for the holidays.
	28	Received $3,100 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 $1,000 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:
a.	The December 31 inventory count of computer supplies shows $650 still available.
b.	Three months have expired since the 12-month insurance premium was paid in advance.
c.	As of December 31, Lyn Addie has not been paid for four days of work at $105 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.
f.	Three of the four months' prepaid rent has expired.
Required:
1.	Prepare journal entries to record each of the December transactions and events for Business Solutions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

2.2	Post the journal entries to record each of the December transactions, adjusting entries to the accounts in the ledger.
General Ledger Accounts

3.	Prepare an adjusted trial balance as of December 31, 2015.

4.	Prepare an income statement for the three months ended December 31, 2015.

5.	Prepare a statement of owners equity for the three months ended December 31, 2015..

6.	Prepare a balance sheet as of December 31, 2015.
7.	Record and post the necessary closing entries for Business Solutions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

8.	Prepare a post-closing trial balance as of December 31, 2015.

Answer & Explanation Solved by verified expert

See Answer