2 Use Redlands’ 2020 balance sheet from Exhibit 2-1 in your Bergevin and MacQueen textbook as the starting point for this problem. Assume that Redlands had the following transactions in 2021: Borrowed $80 in cash from a bank at the beginning of 2021. Received $50 cash from the 2020 consulting engagement. Paid $30 cash for the 2020 operating expenses. Earned $60 in consulting revenue for 2021—collected one-half of the revenue in cash. Incurred $35 of operating expenses in 2021—paid $20 of the operating expenses in cash. Recorded 2021 depreciation expense of $15 on the equipment purchased in 2020. Paid $8 of interest for the $80 cash borrowed at the beginning of 2021.

2 Use Redlands’ 2020 balance sheet from Exhibit 2-1 in your Bergevin and MacQueen textbook as the starting point for this problem. Assume that Redlands had the following transactions in 2021:

1. Borrowed $80 in cash from a bank at the beginning of 2021.
2. Received $50 cash from the 2020 consulting engagement.
3. Paid $30 cash for the 2020 operating expenses.
4. Earned $60 in consulting revenue for 2021—collected one-half of the revenue in cash.
5. Incurred $35 of operating expenses in 2021—paid $20 of the operating expenses in cash.
6. Recorded 2021 depreciation expense of $15 on the equipment purchased in 2020.
7. Paid $8 of interest for the $80 cash borrowed at the beginning of 2021.

Now, use the Session 2 Comprehensive Problem Excel File from above to complete the tables for2021:

1. Record the transactions in the general journal.
2. Post the entries to the ledger (Note that the 2021 beginning balances in each account have already been entered for you, where appropriate).
3. Construct a trial balance.
4. Present the financial statements in good form.
5. Close the temporary accounts.

1. General Journal
   Trans.	Accounts	Debit	Credit
   1	Cash	80
   	Note payable		80
   2	Cash	50
   	Accounts Receivable		50
   3	Accounts Payable	30
   	Cash		30
   4	Cash	30
   	Accounts receivable	30
   	Sales revenue		60
   5	Operating expenses	35
   	Cash		20
   	Accounts payable		15
   6	Depreciation	15
   	Accumulated Depreciation		15
   7	Intrest expense	8
   	Cash		8
   General Journal - Closing Entries
   Date	Accounts	Debit	Credit
   8
   9
   Ledgers
   Assets
   Account	Trans.	Debit	Credit	Balance
   Cash	4	30		$30 db.
   	1	80		$80 db.
   	2	50		$50 db.
   	3		30	$30 db.
   	5		20	$20 db.
   	7		8	$8 db.
   Account	Trans.	Debit	Credit	Balance
   Accounts receivable	2		50	$50 db.
   	4	30		$30db.
   Account	Trans.	Debit	Credit	Balance
   Equipment	4		60	$60 db.
   Account	Trans.	Debit	Credit	Balance
   Accum depreciation	6		15	$15 cr.
   Liabilities
   Account	Trans.	Debit	Credit	Balance
   Accounts payable	3	30		$ 30 cr.
   	5		15	$15 cr.
   Account	Trans.	Debit	Credit	Balance
   Note payable	1		80	$80 cr.
   Shareholders’ Equity
   Account	Trans.	Debit	Credit	Balance
   Common stock				$90 cr.
   Account	Trans.	Debit	Credit	Balance
   Retained earnings				$5 cr.
   Revenues
   Account	Trans.	Debit	Credit	Balance
   Consulting revenues
   Expenses
   Account	Trans.	Debit	Credit	Balance
   Operating expense
   Account	Trans.	Debit	Credit	Balance
   Depreciation exp.
   Account	Trans.	Debit	Credit	Balance
   Interest exp.
   Trial Balance
   12/31/2021
   Accounts	Debit	Credit
   Cash
   Accounts receivable
   Equipment
   Accumulated depreciation
   Accounts payable
   Note payable
   Common stock
   Retained earnings (before close)
   Sales revenues
   Depreciation expense
   Operating expenses
   Interest expense
   Total
   Financial Statements
   Redlands, Inc.
   Income Statement
   For the Year Ended December 31, 2021
   Sales revenue
   Operating expenses
   Depreciation expense
   Interest expense
   Net income
   Redlands, Inc.
   Statement of Shareholders’ Equity
   For the Year Ended December 31, 2021
   Beginning contributed capital
   Capital contributed in 2018
   Ending contributed capital
   Beginning retained earnings
   Net income in 2018
   Ending retained earnings
   Total shareholders' equity
   Redlands, Inc.
   Balance Sheet
   12/31/2021
   Assets
   Cash
   Accounts receivable
   Equipment
   Less: accumulated depreciation
   Total Assets
   Liabilities
   Accounts payable
   Note payable
   Total Liabilities
   Shareholders' Equity (S/E)
   Common stock
   Retained earnings
   Total Shareholders' Equity
   Total Liabilities and S/E
   Redlands, Inc.
   Statement of Cash Flows
   For the Year Ended December 31, 2021
   Cash flows from operating activities:
   Net Income
   Depreciation expense, equipment
   Change in accounts receivable
   Change in accounts payable
   Net cash provided by operating activities
   Cash flows from investing activities:
   Purchase of equipment
   Net cash used for investment activities
   Cash flows from financing activities:
   Issue note payable
   Net cash provided by financing activities
   Net change in cash
   Cash, beginning of the year
   Net change in cash
   Cash, end of the year