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Create a table using the following headings for columns: Cash;Accounts Receivable; Computer Supplies; Computer System; OfficeEquipment; Accounts Payable; S. Rey, Capital; S. Rey, Withdrawals;Revenues; and Expenses. Then use additions and subtractions withinthe table created to show the dollar effects for each of thefollowing October transactions for Business Solutions on theindividual items of the accounting equation. Show new balancesafter each transaction.

Oct.

1

S. Rey invested $45,000 cash, a $20,000 computer system, and$8,000 of office equipment in the company.

3

The company purchased $1,420 of computer supplies on credit fromHarris Office Products.

6

The company billed Easy Leasing $4,800 for services performed ininstalling a new web server.

8

The company paid $1,420 cash for the computer supplies purchasedfrom Harris Office Products on October 3.

10

The company hired Lyn Addie as a part-time assistant for $125per day, as needed.

12

The company billed Easy Leasing another $1,400 for servicesperformed.

15

The company received $4,800 cash from Easy Leasing as partialpayment toward its account.

17

The company paid $805 cash to repair computer equipment damagedwhen moving it.

20

The company paid $1,728 cash for advertisements published in thelocal newspaper.

22

The company received $1,400 cash from Easy Leasing toward itsaccount.

28

The company billed IFM Company $5,208 for servicesperformed.

31

The company paid $875 cash for Lyn Addie’s wages for seven daysof work this month.

31

S. Rey withdrew $3,600 cash from the company for personaluse.

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Reid Wolff
Reid WolffLv2
28 Sep 2019

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On October 1, 2017, Santana Rey launched a computer servicescompany, Business Solutions, that is organized as a proprietorshipand provides consulting services, computer system installations,and custom program development. Rey adopts the calendar year forreporting purposes and expects to prepare the company’s first setof financial statements on December 31, 2017.

Oct. 1

S. Rey invested $50,000 cash, a $24,000 computer system, and$12,000 of office equipment in the company.
3 The companypurchased $1,400 of computer supplies on credit from Harris OfficeProducts.
6 The companybilled Easy Leasing $5,400 for services performed in installing anew web server.
8

The company paid $1,400 cash for the computer supplies purchasedfrom Harris Office Products on October 3.
10 The companyhired Lyn Addie as a part-time assistant for $140 per day, asneeded.
12 The companybilled Easy Leasing another $2,000 for services performed.
15 The companyreceived $5,400 cash from Easy Leasing as partial payment towardits account.
17 The company paid$750 cash to repair computer equipment damaged when moving it.
20 The company paid$1,648 cash for advertisements published in the localnewspaper.
22 The companyreceived $2,000 cash from Easy Leasing toward its account.
28 The companybilled IFM Company $5,303 for services performed.
31 The company paid$980 cash for Lyn Addie’s wages for seven days of work thismonth.
31 S. Rey withdrew$3,400 cash from the company for personal use.


Required:
Enter the amount of each transaction on individual items of theaccounting equation. Show new balances after each transaction.(Enter decreases to account balances with a minus sign.Enter as per the transaction order provided in the questiondata.)

On October 1, 2015, Santana Rey launched a computer servicescompany called Business Solutions, which provides consultingservices, computer system installations, and custom programdevelopment. Rey adopts the calendar year for reporting purposesand expects to prepare the company’s first set of financialstatements on December 31, 2015. The company’s initial chart ofaccounts follows. Account No. Account No. Cash 101 Common Stock 307Accounts Receivable 106 Dividends 319 Computer Supplies 126Computer Services Revenue 403 Prepaid Insurance 128 Wages Expense623 Prepaid Rent 131 Advertising Expense 655 Office Equipment 163Mileage Expense 676 Computer Equipment 167 Miscellaneous Expenses677 Accounts Payable 201 Repairs Expense—Computer 684--------------------------------------------------------------------------------Oct. 1 S. Rey invested $45,000 cash, a $20,000 computer system, and$8,000 of office equipment in the company in exchange for itscommon stock. 2 The company paid $3,300 cash for four months’ rent.(Hint: Debit Prepaid Rent for $3,300.) 3 The company purchased$1,420 of computer supplies on credit from Harris Office Products.5 The company paid $2,220 cash for one year’s premium on a propertyand liability insurance policy. (Hint: Debit Prepaid Insurance for$2,220.) 6 The company billed Easy Leasing $4,800 for servicesperformed in installing a new Web server. 8 The company paid $1,420cash for the computer supplies purchased from Harris OfficeProducts on October 3. 10 The company hired Lyn Addie as apart-time assistant for $125 per day, as needed. 12 The companybilled Easy Leasing another $1,400 for services performed. 15 Thecompany received $4,800 cash from Easy Leasing as partial paymenton its account. 17 The company paid $805 cash to repair computerequipment that was damaged when moving it. 20 The company paid$1,728 cash for advertisements published in the local newspaper. 22The company received $1,400 cash from Easy Leasing on its account.28 The company billed IFM Company $5,208 for services performed. 31The company paid $875 cash for Lyn Addie's wages for seven days'work. 31 The company paid $3,600 cash in dividends. Nov. 1 Thecompany reimbursed S. Rey in cash for business automobile mileageallowance (Rey logged 1,000 miles at $0.32 per mile). 2 The companyreceived $4,633 cash from Liu Corporation for computer servicesperformed. 5 The company purchased computer supplies for $1,125cash from Harris Office Products. 8 The company billed Gomez Co.$5,668 for services performed. 13 The company received notificationfrom Alex's Engineering Co. that Business Solutions' bid of $3,950for an upcoming project is accepted. 18 The company received $2,208cash from IFM Company as partial payment of the October 28 bill. 22The company donated $250 cash to the United Way in the company'sname. 24 The company completed work for Alex's Engineering Co. andsent it a bill for $3,950. 25 The company sent another bill to IFMCompany for the past-due amount of $3,000. 28 The companyreimbursed S. Rey in cash for business automobile mileage (1,200miles at $0.32 per mile). 30 The company paid $1,750 cash for LynAddie's wages for 14 days' work. 30 The company paid $2,000 cash individends. How do you find the cash, account receivable, andcomputer services revenue in the trial balance?

After the success of the company’s first two months, Santana Rey continues to operate Business Solutions. The November 30, 2017, unadjusted trial balance of Business Solutions (reflecting its transactions for October and November of 2017) follows. No. Account Title Debit Credit 101 Cash $ 38,364 106 Accounts receivable 13,218 126 Computer supplies 2,645 128 Prepaid insurance 2,100 131 Prepaid rent 3,220 163 Office equipment 8,100 164 Accumulated depreciation—Office equipment $ 0 167 Computer equipment 22,400 168 Accumulated depreciation—Computer equipment 0 201 Accounts payable 0 210 Wages payable 0 236 Unearned computer services revenue 0 301 S. Rey, Capital 71,000 302 S. Rey, Withdrawals 6,000 403 Computer services revenue 30,744 612 Depreciation expense—Office equipment 0 613 Depreciation expense—Computer equipment 0 623 Wages expense 2,450 637 Insurance expense 0 640 Rent expense 0 652 Computer supplies expense 0 655 Advertising expense 1,678 676 Mileage expense 634 677 Miscellaneous expenses 150 684 Repairs expense—Computer 785 Totals $ 101,744 $ 101,744 Business Solutions had the following transactions and events in December 2017. Dec. 2 Paid $1,015 cash to Hillside Mall for Business Solutions’ share of mall advertising costs. 3 Paid $420 cash for minor repairs to the company’s computer. 4 Received $4,450 cash from Alex’s 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 Alex’s Engineering Co. that Business Solutions’ bid of $7,300 on a proposed project has been accepted. Alex’s paid a $1,600 cash advance to Business Solutions. 15 Purchased $1,600 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 $6,425 cash. 22–26 Took the week off for the holidays. 28 Received $3,600 cash from Gomez Co. on its receivable. 29 Reimbursed S. Rey for business automobile mileage (500 miles at $0.29 per mile). 31 S. Rey withdrew $1,300 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: a.The December 31 inventory count of computer supplies shows $660 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. 2-a. Prepare adjusting entries to reflect a through f. 2-b. Post the journal entries to record each of the December transactions, adjusting entries to the accounts in the ledger. 3. Prepare an adjusted trial balance as of December 31, 2017. 4. Prepare an income statement for the three months ended December 31, 2017. 5. Prepare a statement of owner’s equity for the three months ended December 31, 2017. 6. Prepare a balance sheet as of December 31, 2017.

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