After the success of the company's first two months, Santana Rey continues to operate Business Solutions. The November 30, 2020, unadjusted trial balance of Business Solutions (reflecting its transactions for October and November of 2020) follows. Number 101 106 126 128 131 163 164 167 168 Accumulated depreciation-Computer equipment 201 210 236 307 318 319 403 612 613 623 637 640 652 655 Account Title 676 677 684 Cash Accounts receivable Computer supplies Prepaid insurance Prepaid rent Office equipment Accumulated depreciation-Office equipment Computer equipment Accounts payable Wages payable Unearned computer services revenue Common stock Retained earnings Dividends Computer services revenue Depreciation expense-Office equipment Depreciation expense-Computer equipment Wages expense Insurance expense Rent expense Computer supplies expense Advertising expense Mileage expense Miscellaneous expenses Repairs expense-Computer Totals Debit $ 38,464 13,118 2,545 1,920 3,220 8,600 20,400 5,900 0 0 2,475 0 0 0 1,668 614 250 715 $ 99,889 Credit 64 0 0 0 0 65,000 0 34,889 $ 99,889 Business Solutions had the following transactions and events in December 2020. December 2 Paid $995 cash to Hillside Mall for Business Solutions's share of mall advertising costs. December 3 Paid $490 cash for minor repairs to the company's computer. December 4 Received $4,350 cash from Alex's Engineering Co. for the receivable from November. December 10 Paid cash to Lyn Addie for six days of work at the rate of $125 per day. December 14 Notified by Alex's Engineering Company that Business Solutions's bid of $7,700 on a proposed project has been accepted. Alex's paid a $2,300 cash advance to Business Solutions. December 15 Purchased $1,900 of computer supplies on credit from Harris Office Products. December 16 Sent a reminder to Gomez Company to pay the fee for services recorded on November 8. December 20 Completed a project for Liu Corporation and received $6,025 cash. December 22-26 Took the week off for the holidays. December 28 Received $3,500 cash from Gomez Company on its receivable. December 29 Reimbursed S. Rey for business automobile mileage (400 miles at $0.26 per mile). December 31 The company paid $1,500 cash in dividends. 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 $620 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 $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. f. Three of the four months' prepaid rent have expired.

After the success of the company's first two months, Santana Rey continues to operate Business Solutions. The November 30, 2020, unadjusted trial balance of Business Solutions (reflecting its transactions for October and November of 2020) follows. Number 101 106 126 128 131 163 164 167 168 Accumulated depreciation-Computer equipment 201 210 236 307 318 319 403 612 613 623 637 640 652 655 Account Title 676 677 684 Cash Accounts receivable Computer supplies Prepaid insurance Prepaid rent Office equipment Accumulated depreciation-Office equipment Computer equipment Accounts payable Wages payable Unearned computer services revenue Common stock Retained earnings Dividends Computer services revenue Depreciation expense-Office equipment Depreciation expense-Computer equipment Wages expense Insurance expense Rent expense Computer supplies expense Advertising expense Mileage expense Miscellaneous expenses Repairs expense-Computer Totals Debit $ 38,464 13,118 2,545 1,920 3,220 8,600 20,400 5,900 0 0 2,475 0 0 0 1,668 614 250 715 $ 99,889 Credit 64 0 0 0 0 65,000 0 34,889 $ 99,889 Business Solutions had the following transactions and events in December 2020. December 2 Paid $995 cash to Hillside Mall for Business Solutions's share of mall advertising costs. December 3 Paid $490 cash for minor repairs to the company's computer. December 4 Received $4,350 cash from Alex's Engineering Co. for the receivable from November. December 10 Paid cash to Lyn Addie for six days of work at the rate of $125 per day. December 14 Notified by Alex's Engineering Company that Business Solutions's bid of $7,700 on a proposed project has been accepted. Alex's paid a $2,300 cash advance to Business Solutions. December 15 Purchased $1,900 of computer supplies on credit from Harris Office Products. December 16 Sent a reminder to Gomez Company to pay the fee for services recorded on November 8. December 20 Completed a project for Liu Corporation and received $6,025 cash. December 22-26 Took the week off for the holidays. December 28 Received $3,500 cash from Gomez Company on its receivable. December 29 Reimbursed S. Rey for business automobile mileage (400 miles at $0.26 per mile). December 31 The company paid $1,500 cash in dividends. 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 $620 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 $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. f. Three of the four months' prepaid rent have expired.

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter21: Accounting For Accruals, Deferrals, And Reversing Entries

Section21.1: Accruals

Problem 1WT

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