Santana Rey created Business Solutions on October 1, 2017. The company has been successful, and its...

 

 

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Santana Rey created Business Solutions on October 1, 2017. The company has been successful, and its list of customers has grown, To accommodate the growth, the accounting system is modified to set up separate accounts for each customer. The following chart of accounts includes the account number used for each account and any balance as ofr December 31, 2017. Santana Rey decided to add a fourth digit with a decimal point to the 106 account nurmber that had been used for the single Accounts Receivable account. This change allows the company to continue using the existing chart of accounts. No. 101 106.1 Alex's Engineering Co. 106.2 Wildcat Services 106.3 Easy Leasing 106.4 IFM Co. 106.5 Liu Corp. 106.6 Gomez Co . 106.7 Delta Co. 106.8 KC. 106.9 Dream, Inc. 119 126 128 131 163 Account Title Debit Credit Cash $48, 462 3,180 2,678 Inc. Merchandise inventory Computer supplies Prepaid insurance Prepaid rent office equipment Accumulated depreciation-orfice equipment Computer equipment Accumulated depreciation-Computer equipment Accounts payable 610 1,962 905 8,030 164 270 167 21,700 168 201 218 1, 080 1,350 Wanas navahle 210 Wages payable Unearned computer services revenue S. Rey, Capital S. Rey, Withdrawals Computer services revenue Sales Sales returns and allowances Sales discounts Cost of goods sold 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 020 1,340 82, 867 236 301 382 403 413 414 415 502 612 613 623 637 640 652 655 676 677 684 In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 1/10, n/30, FOB shipping point, to all customers who purchase this merchandise. However, no cash discount is available on consulting fees, Additional accounts (Nos. 119, 413, 414, 415, and 502) are added to its general ledger to accommodate the company's new merchandising activities. Also, Business Solutions does not use reversing entries and, therefore, all revenue and expense accounts have zero beginning balances as of January 1, 2018. Its transactions for January through March follow: Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of s205 per day, Four of the Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of $205 per day. Four of the five days relate to wages payable that were accrued in the prior year. 5 Santana Rey invested an additional $24, 400 cash in the company. 7 The company purchased $7,000 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB shipping point, invoice dated January 7. 9 The company received $2,678 cash from Gomez Co. as full payment on its account. 11 The company completed a five-day project for Alex's Engineering Co. and billed it $5, 310, which is the total price of $6,650 less the advance payment of $1, 340. 13 The company sold merchandise with a retail value of $4, 000 and a cost of $3, 520 to Liu Corp., invoice dated January 13. 15 The company paid $650 cash for freight charges on the merchandise purchased on January 7. 16 The company received $4,070 cash from Delta Co. for computer services provided. 17 The company paid Kansas Corp. for the invoice dated January 7, net of t he discount. 20 Liu Corp. returned $700 of defective merchandise from its invoice dated January 13. The returned merchandise, which had a $300 cost, is discarded. (The policy of Business Solutions is to leave the cost of defective products in cost of goods sold.) 22 The company received the balance due from Liu Corp., net of both the discount and the credit for the returned merchandise. 24 The company returned defective merchandise to Kansas Corp. and accepted a credit against future purchases. The defective merchandise invoice cost, net of the discount, was $476. 26 The company purchased $9, 700 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB destination, invoice dated January 26. 26 The company sold merchandise with a $4, 460 cost for $5,,980 on credit to KC, Inc., invoice dated January 26. 31 The company paid cash to Lyn Addie for 10 days' work at $205 per day. Feb. 1 The company paid $2, 715 cash to Hillside Mall for another three nonths rent in advance. 3 The company paid Kansas Corp. for the balance due, net of the cash discount, less the $476 amount in the credit memorandum, 5 The company paid $550 cash to the local newapaper for an advertising insert in today's paper. 3He Lumpany pAU 0 Laa LU LIe AULL UWap er ur auve LLBLy Hser AH LUUay a paper. 11 The company received the balance due from Alex's Engineering Co. for fees billed on January 11, 15 Santana Rey withdrew $4, 620 cash from the company for personal use. 23 The company sold merchandise with a $2,620 cost for $3, 290 on credit to Delta Co., invoice dated February 23. 26 The company paid cash to Lyn Addie for eight days' work at $205 per day. 27 The company reimbursed Santana Rey for business automobile mileage (400 miles at $0.32 per mile). 8 The company purchased $2, 890 of computer supplies from Harris Oorfice Products on credit, invoice dated March 8. 9 The company received the balance due from Delta Co. for merchandise sold on February 23, 11 The company paid $770 cash for minor repairs to the company's computer. 16 The company received $5, 330 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due to Harris Office Products, consisting of amounts created on December 15 (of $1, 150) and March 8. 24 The company billed Easy Leasing for $9, 117 of computing services provided. 25 The company sold merchandise with a $2,172 cost for $2,870 on credit to Wildcat Services, invaice dated March 25. 30 The company sold merchandise with a $1,058 cost for $2, 24e on credit to IFM Company, invoice dated March 30. 31 The company reimbursed Santana Rey for business automobile mileage (1,000 miles at $0.32 per mile). Mar. The following additional facts are available for preparing adjustments on March 31 prior to financial statement preparation: a. The March 31 amount of computer supplies still available totals $2,165. b. Three more months have expired since the company purchased its annual insurance policy at a $2,616 cost for 12 months of coverage. c. Lyn Addie has not been paid for seven days of work at the rate of $205 per day d. Three months have passed since any prepaid rent has been transferred to expense. The monthly rent expense is $905. e. Depreciation on the computer equipment for January 1 through March 31 is $1,080. f. Depreciation on the office equipment for January 1 through March 31 is $270. g. The March 31 amount of merchandise inventory still available totals $524. Part 2 2. Post the journal entries in part 1 to the accounts in the company's general ledger. (Note: Begin with the ledger's post-clc adjusted balances as of December 31, 2017) (Record the transactions in the order presented. Do not skip rows.) 101 Cash 106.1 Accounts Receivable-Alex's Engineering Co. Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 0. 106.2 Accounts Receivable-Wildcat Services 106.3 Accounts Receivable-Easy Leasing Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 106.4 Accounts Receivable-IFM Co. 106.5 Accounts Receivable-Liu Corporation Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 106.6 Accounts Receivable-Gomez Co. 106.7 Accounts Receivable-Delta Co. Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec 31 Dale Debit Credit Balance Date Debit Crodit Balance Dec. 31 Dec. 31 119 Merchandise Inventory 126 Computer Supplies Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 128 Prepaid Insurance 131 Prepaid Rent Date Debit Credit Balance Date Dobit Crodit Balance Dec. 31 Dec, 31 163 Office Equipment 164 Accumulated DeprociationOffice Equipment Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 167 Computer Equipment 168 Accumulated Depreciation-Computer Equipment Date Debit Credit Balance Date Debit Credit Balance Dec 31 Dec. 31 201 Accounts Payable 210 Wages Payable Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 236 Unearned Computer Services Revenue 301 S. Rey, Capital Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec, 31 302 S. Rey, Withdrawals 403 Computer Services Revonue Date Debit Credit Balance Date Debit Credit Balance 413 Sales 414 Sales Returns and Allowances Date Debit Credit Balance Date Debit Credit Balance Scld 415 Sales Discounts 502 Cost of Goods Sold Date Debit Credit Balance Date Debit Credit Balance 612 Depreciation Expense-Office Equipment 613 Dopreciation Expense-Computer Equipment Date Debit Credit Balance Date Debit Credit Balance 623 Wages Expense 637 Insurance Expense Date Debit Credit Balance Date Debit Credit Balance 640 Rent Expense 652 Computer Supplies Expense Debit Credit Balance Date Dobit Credit Balance Date 655 Advertising Expense 676 Mileage Expense Balance Date Debit Credit Balance Date Debit Credit 677 Miscellaneous Expenses 684 Repairs Expense-Computer Date Debit Credit Balance Date Debit Credit Balance Santana Rey created Business Solutions on October 1, 2017. The company has been successful, and its list of customers has grown, To accommodate the growth, the accounting system is modified to set up separate accounts for each customer. The following chart of accounts includes the account number used for each account and any balance as ofr December 31, 2017. Santana Rey decided to add a fourth digit with a decimal point to the 106 account nurmber that had been used for the single Accounts Receivable account. This change allows the company to continue using the existing chart of accounts. No. 101 106.1 Alex's Engineering Co. 106.2 Wildcat Services 106.3 Easy Leasing 106.4 IFM Co. 106.5 Liu Corp. 106.6 Gomez Co . 106.7 Delta Co. 106.8 KC. 106.9 Dream, Inc. 119 126 128 131 163 Account Title Debit Credit Cash $48, 462 3,180 2,678 Inc. Merchandise inventory Computer supplies Prepaid insurance Prepaid rent office equipment Accumulated depreciation-orfice equipment Computer equipment Accumulated depreciation-Computer equipment Accounts payable 610 1,962 905 8,030 164 270 167 21,700 168 201 218 1, 080 1,350 Wanas navahle 210 Wages payable Unearned computer services revenue S. Rey, Capital S. Rey, Withdrawals Computer services revenue Sales Sales returns and allowances Sales discounts Cost of goods sold 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 020 1,340 82, 867 236 301 382 403 413 414 415 502 612 613 623 637 640 652 655 676 677 684 In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 1/10, n/30, FOB shipping point, to all customers who purchase this merchandise. However, no cash discount is available on consulting fees, Additional accounts (Nos. 119, 413, 414, 415, and 502) are added to its general ledger to accommodate the company's new merchandising activities. Also, Business Solutions does not use reversing entries and, therefore, all revenue and expense accounts have zero beginning balances as of January 1, 2018. Its transactions for January through March follow: Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of s205 per day, Four of the Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of $205 per day. Four of the five days relate to wages payable that were accrued in the prior year. 5 Santana Rey invested an additional $24, 400 cash in the company. 7 The company purchased $7,000 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB shipping point, invoice dated January 7. 9 The company received $2,678 cash from Gomez Co. as full payment on its account. 11 The company completed a five-day project for Alex's Engineering Co. and billed it $5, 310, which is the total price of $6,650 less the advance payment of $1, 340. 13 The company sold merchandise with a retail value of $4, 000 and a cost of $3, 520 to Liu Corp., invoice dated January 13. 15 The company paid $650 cash for freight charges on the merchandise purchased on January 7. 16 The company received $4,070 cash from Delta Co. for computer services provided. 17 The company paid Kansas Corp. for the invoice dated January 7, net of t he discount. 20 Liu Corp. returned $700 of defective merchandise from its invoice dated January 13. The returned merchandise, which had a $300 cost, is discarded. (The policy of Business Solutions is to leave the cost of defective products in cost of goods sold.) 22 The company received the balance due from Liu Corp., net of both the discount and the credit for the returned merchandise. 24 The company returned defective merchandise to Kansas Corp. and accepted a credit against future purchases. The defective merchandise invoice cost, net of the discount, was $476. 26 The company purchased $9, 700 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB destination, invoice dated January 26. 26 The company sold merchandise with a $4, 460 cost for $5,,980 on credit to KC, Inc., invoice dated January 26. 31 The company paid cash to Lyn Addie for 10 days' work at $205 per day. Feb. 1 The company paid $2, 715 cash to Hillside Mall for another three nonths rent in advance. 3 The company paid Kansas Corp. for the balance due, net of the cash discount, less the $476 amount in the credit memorandum, 5 The company paid $550 cash to the local newapaper for an advertising insert in today's paper. 3He Lumpany pAU 0 Laa LU LIe AULL UWap er ur auve LLBLy Hser AH LUUay a paper. 11 The company received the balance due from Alex's Engineering Co. for fees billed on January 11, 15 Santana Rey withdrew $4, 620 cash from the company for personal use. 23 The company sold merchandise with a $2,620 cost for $3, 290 on credit to Delta Co., invoice dated February 23. 26 The company paid cash to Lyn Addie for eight days' work at $205 per day. 27 The company reimbursed Santana Rey for business automobile mileage (400 miles at $0.32 per mile). 8 The company purchased $2, 890 of computer supplies from Harris Oorfice Products on credit, invoice dated March 8. 9 The company received the balance due from Delta Co. for merchandise sold on February 23, 11 The company paid $770 cash for minor repairs to the company's computer. 16 The company received $5, 330 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due to Harris Office Products, consisting of amounts created on December 15 (of $1, 150) and March 8. 24 The company billed Easy Leasing for $9, 117 of computing services provided. 25 The company sold merchandise with a $2,172 cost for $2,870 on credit to Wildcat Services, invaice dated March 25. 30 The company sold merchandise with a $1,058 cost for $2, 24e on credit to IFM Company, invoice dated March 30. 31 The company reimbursed Santana Rey for business automobile mileage (1,000 miles at $0.32 per mile). Mar. The following additional facts are available for preparing adjustments on March 31 prior to financial statement preparation: a. The March 31 amount of computer supplies still available totals $2,165. b. Three more months have expired since the company purchased its annual insurance policy at a $2,616 cost for 12 months of coverage. c. Lyn Addie has not been paid for seven days of work at the rate of $205 per day d. Three months have passed since any prepaid rent has been transferred to expense. The monthly rent expense is $905. e. Depreciation on the computer equipment for January 1 through March 31 is $1,080. f. Depreciation on the office equipment for January 1 through March 31 is $270. g. The March 31 amount of merchandise inventory still available totals $524. Part 2 2. Post the journal entries in part 1 to the accounts in the company's general ledger. (Note: Begin with the ledger's post-clc adjusted balances as of December 31, 2017) (Record the transactions in the order presented. Do not skip rows.) 101 Cash 106.1 Accounts Receivable-Alex's Engineering Co. Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 0. 106.2 Accounts Receivable-Wildcat Services 106.3 Accounts Receivable-Easy Leasing Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 106.4 Accounts Receivable-IFM Co. 106.5 Accounts Receivable-Liu Corporation Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 106.6 Accounts Receivable-Gomez Co. 106.7 Accounts Receivable-Delta Co. Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec 31 Dale Debit Credit Balance Date Debit Crodit Balance Dec. 31 Dec. 31 119 Merchandise Inventory 126 Computer Supplies Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 128 Prepaid Insurance 131 Prepaid Rent Date Debit Credit Balance Date Dobit Crodit Balance Dec. 31 Dec, 31 163 Office Equipment 164 Accumulated DeprociationOffice Equipment Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 167 Computer Equipment 168 Accumulated Depreciation-Computer Equipment Date Debit Credit Balance Date Debit Credit Balance Dec 31 Dec. 31 201 Accounts Payable 210 Wages Payable Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 236 Unearned Computer Services Revenue 301 S. Rey, Capital Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec, 31 302 S. Rey, Withdrawals 403 Computer Services Revonue Date Debit Credit Balance Date Debit Credit Balance 413 Sales 414 Sales Returns and Allowances Date Debit Credit Balance Date Debit Credit Balance Scld 415 Sales Discounts 502 Cost of Goods Sold Date Debit Credit Balance Date Debit Credit Balance 612 Depreciation Expense-Office Equipment 613 Dopreciation Expense-Computer Equipment Date Debit Credit Balance Date Debit Credit Balance 623 Wages Expense 637 Insurance Expense Date Debit Credit Balance Date Debit Credit Balance 640 Rent Expense 652 Computer Supplies Expense Debit Credit Balance Date Dobit Credit Balance Date 655 Advertising Expense 676 Mileage Expense Balance Date Debit Credit Balance Date Debit Credit 677 Miscellaneous Expenses 684 Repairs Expense-Computer Date Debit Credit Balance Date Debit Credit Balance Santana Rey created Business Solutions on October 1, 2017. The company has been successful, and its list of customers has grown, To accommodate the growth, the accounting system is modified to set up separate accounts for each customer. The following chart of accounts includes the account number used for each account and any balance as ofr December 31, 2017. Santana Rey decided to add a fourth digit with a decimal point to the 106 account nurmber that had been used for the single Accounts Receivable account. This change allows the company to continue using the existing chart of accounts. No. 101 106.1 Alex's Engineering Co. 106.2 Wildcat Services 106.3 Easy Leasing 106.4 IFM Co. 106.5 Liu Corp. 106.6 Gomez Co . 106.7 Delta Co. 106.8 KC. 106.9 Dream, Inc. 119 126 128 131 163 Account Title Debit Credit Cash $48, 462 3,180 2,678 Inc. Merchandise inventory Computer supplies Prepaid insurance Prepaid rent office equipment Accumulated depreciation-orfice equipment Computer equipment Accumulated depreciation-Computer equipment Accounts payable 610 1,962 905 8,030 164 270 167 21,700 168 201 218 1, 080 1,350 Wanas navahle 210 Wages payable Unearned computer services revenue S. Rey, Capital S. Rey, Withdrawals Computer services revenue Sales Sales returns and allowances Sales discounts Cost of goods sold 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 020 1,340 82, 867 236 301 382 403 413 414 415 502 612 613 623 637 640 652 655 676 677 684 In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 1/10, n/30, FOB shipping point, to all customers who purchase this merchandise. However, no cash discount is available on consulting fees, Additional accounts (Nos. 119, 413, 414, 415, and 502) are added to its general ledger to accommodate the company's new merchandising activities. Also, Business Solutions does not use reversing entries and, therefore, all revenue and expense accounts have zero beginning balances as of January 1, 2018. Its transactions for January through March follow: Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of s205 per day, Four of the Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of $205 per day. Four of the five days relate to wages payable that were accrued in the prior year. 5 Santana Rey invested an additional $24, 400 cash in the company. 7 The company purchased $7,000 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB shipping point, invoice dated January 7. 9 The company received $2,678 cash from Gomez Co. as full payment on its account. 11 The company completed a five-day project for Alex's Engineering Co. and billed it $5, 310, which is the total price of $6,650 less the advance payment of $1, 340. 13 The company sold merchandise with a retail value of $4, 000 and a cost of $3, 520 to Liu Corp., invoice dated January 13. 15 The company paid $650 cash for freight charges on the merchandise purchased on January 7. 16 The company received $4,070 cash from Delta Co. for computer services provided. 17 The company paid Kansas Corp. for the invoice dated January 7, net of t he discount. 20 Liu Corp. returned $700 of defective merchandise from its invoice dated January 13. The returned merchandise, which had a $300 cost, is discarded. (The policy of Business Solutions is to leave the cost of defective products in cost of goods sold.) 22 The company received the balance due from Liu Corp., net of both the discount and the credit for the returned merchandise. 24 The company returned defective merchandise to Kansas Corp. and accepted a credit against future purchases. The defective merchandise invoice cost, net of the discount, was $476. 26 The company purchased $9, 700 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB destination, invoice dated January 26. 26 The company sold merchandise with a $4, 460 cost for $5,,980 on credit to KC, Inc., invoice dated January 26. 31 The company paid cash to Lyn Addie for 10 days' work at $205 per day. Feb. 1 The company paid $2, 715 cash to Hillside Mall for another three nonths rent in advance. 3 The company paid Kansas Corp. for the balance due, net of the cash discount, less the $476 amount in the credit memorandum, 5 The company paid $550 cash to the local newapaper for an advertising insert in today's paper. 3He Lumpany pAU 0 Laa LU LIe AULL UWap er ur auve LLBLy Hser AH LUUay a paper. 11 The company received the balance due from Alex's Engineering Co. for fees billed on January 11, 15 Santana Rey withdrew $4, 620 cash from the company for personal use. 23 The company sold merchandise with a $2,620 cost for $3, 290 on credit to Delta Co., invoice dated February 23. 26 The company paid cash to Lyn Addie for eight days' work at $205 per day. 27 The company reimbursed Santana Rey for business automobile mileage (400 miles at $0.32 per mile). 8 The company purchased $2, 890 of computer supplies from Harris Oorfice Products on credit, invoice dated March 8. 9 The company received the balance due from Delta Co. for merchandise sold on February 23, 11 The company paid $770 cash for minor repairs to the company's computer. 16 The company received $5, 330 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due to Harris Office Products, consisting of amounts created on December 15 (of $1, 150) and March 8. 24 The company billed Easy Leasing for $9, 117 of computing services provided. 25 The company sold merchandise with a $2,172 cost for $2,870 on credit to Wildcat Services, invaice dated March 25. 30 The company sold merchandise with a $1,058 cost for $2, 24e on credit to IFM Company, invoice dated March 30. 31 The company reimbursed Santana Rey for business automobile mileage (1,000 miles at $0.32 per mile). Mar. The following additional facts are available for preparing adjustments on March 31 prior to financial statement preparation: a. The March 31 amount of computer supplies still available totals $2,165. b. Three more months have expired since the company purchased its annual insurance policy at a $2,616 cost for 12 months of coverage. c. Lyn Addie has not been paid for seven days of work at the rate of $205 per day d. Three months have passed since any prepaid rent has been transferred to expense. The monthly rent expense is $905. e. Depreciation on the computer equipment for January 1 through March 31 is $1,080. f. Depreciation on the office equipment for January 1 through March 31 is $270. g. The March 31 amount of merchandise inventory still available totals $524. Part 2 2. Post the journal entries in part 1 to the accounts in the company's general ledger. (Note: Begin with the ledger's post-clc adjusted balances as of December 31, 2017) (Record the transactions in the order presented. Do not skip rows.) 101 Cash 106.1 Accounts Receivable-Alex's Engineering Co. Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 0. 106.2 Accounts Receivable-Wildcat Services 106.3 Accounts Receivable-Easy Leasing Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 106.4 Accounts Receivable-IFM Co. 106.5 Accounts Receivable-Liu Corporation Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 106.6 Accounts Receivable-Gomez Co. 106.7 Accounts Receivable-Delta Co. Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec 31 Dale Debit Credit Balance Date Debit Crodit Balance Dec. 31 Dec. 31 119 Merchandise Inventory 126 Computer Supplies Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 128 Prepaid Insurance 131 Prepaid Rent Date Debit Credit Balance Date Dobit Crodit Balance Dec. 31 Dec, 31 163 Office Equipment 164 Accumulated DeprociationOffice Equipment Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 167 Computer Equipment 168 Accumulated Depreciation-Computer Equipment Date Debit Credit Balance Date Debit Credit Balance Dec 31 Dec. 31 201 Accounts Payable 210 Wages Payable Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 236 Unearned Computer Services Revenue 301 S. Rey, Capital Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec, 31 302 S. Rey, Withdrawals 403 Computer Services Revonue Date Debit Credit Balance Date Debit Credit Balance 413 Sales 414 Sales Returns and Allowances Date Debit Credit Balance Date Debit Credit Balance Scld 415 Sales Discounts 502 Cost of Goods Sold Date Debit Credit Balance Date Debit Credit Balance 612 Depreciation Expense-Office Equipment 613 Dopreciation Expense-Computer Equipment Date Debit Credit Balance Date Debit Credit Balance 623 Wages Expense 637 Insurance Expense Date Debit Credit Balance Date Debit Credit Balance 640 Rent Expense 652 Computer Supplies Expense Debit Credit Balance Date Dobit Credit Balance Date 655 Advertising Expense 676 Mileage Expense Balance Date Debit Credit Balance Date Debit Credit 677 Miscellaneous Expenses 684 Repairs Expense-Computer Date Debit Credit Balance Date Debit Credit Balance Santana Rey created Business Solutions on October 1, 2017. The company has been successful, and its list of customers has grown, To accommodate the growth, the accounting system is modified to set up separate accounts for each customer. The following chart of accounts includes the account number used for each account and any balance as ofr December 31, 2017. Santana Rey decided to add a fourth digit with a decimal point to the 106 account nurmber that had been used for the single Accounts Receivable account. This change allows the company to continue using the existing chart of accounts. No. 101 106.1 Alex's Engineering Co. 106.2 Wildcat Services 106.3 Easy Leasing 106.4 IFM Co. 106.5 Liu Corp. 106.6 Gomez Co . 106.7 Delta Co. 106.8 KC. 106.9 Dream, Inc. 119 126 128 131 163 Account Title Debit Credit Cash $48, 462 3,180 2,678 Inc. Merchandise inventory Computer supplies Prepaid insurance Prepaid rent office equipment Accumulated depreciation-orfice equipment Computer equipment Accumulated depreciation-Computer equipment Accounts payable 610 1,962 905 8,030 164 270 167 21,700 168 201 218 1, 080 1,350 Wanas navahle 210 Wages payable Unearned computer services revenue S. Rey, Capital S. Rey, Withdrawals Computer services revenue Sales Sales returns and allowances Sales discounts Cost of goods sold 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 020 1,340 82, 867 236 301 382 403 413 414 415 502 612 613 623 637 640 652 655 676 677 684 In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 1/10, n/30, FOB shipping point, to all customers who purchase this merchandise. However, no cash discount is available on consulting fees, Additional accounts (Nos. 119, 413, 414, 415, and 502) are added to its general ledger to accommodate the company's new merchandising activities. Also, Business Solutions does not use reversing entries and, therefore, all revenue and expense accounts have zero beginning balances as of January 1, 2018. Its transactions for January through March follow: Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of s205 per day, Four of the Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of $205 per day. Four of the five days relate to wages payable that were accrued in the prior year. 5 Santana Rey invested an additional $24, 400 cash in the company. 7 The company purchased $7,000 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB shipping point, invoice dated January 7. 9 The company received $2,678 cash from Gomez Co. as full payment on its account. 11 The company completed a five-day project for Alex's Engineering Co. and billed it $5, 310, which is the total price of $6,650 less the advance payment of $1, 340. 13 The company sold merchandise with a retail value of $4, 000 and a cost of $3, 520 to Liu Corp., invoice dated January 13. 15 The company paid $650 cash for freight charges on the merchandise purchased on January 7. 16 The company received $4,070 cash from Delta Co. for computer services provided. 17 The company paid Kansas Corp. for the invoice dated January 7, net of t he discount. 20 Liu Corp. returned $700 of defective merchandise from its invoice dated January 13. The returned merchandise, which had a $300 cost, is discarded. (The policy of Business Solutions is to leave the cost of defective products in cost of goods sold.) 22 The company received the balance due from Liu Corp., net of both the discount and the credit for the returned merchandise. 24 The company returned defective merchandise to Kansas Corp. and accepted a credit against future purchases. The defective merchandise invoice cost, net of the discount, was $476. 26 The company purchased $9, 700 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB destination, invoice dated January 26. 26 The company sold merchandise with a $4, 460 cost for $5,,980 on credit to KC, Inc., invoice dated January 26. 31 The company paid cash to Lyn Addie for 10 days' work at $205 per day. Feb. 1 The company paid $2, 715 cash to Hillside Mall for another three nonths rent in advance. 3 The company paid Kansas Corp. for the balance due, net of the cash discount, less the $476 amount in the credit memorandum, 5 The company paid $550 cash to the local newapaper for an advertising insert in today's paper. 3He Lumpany pAU 0 Laa LU LIe AULL UWap er ur auve LLBLy Hser AH LUUay a paper. 11 The company received the balance due from Alex's Engineering Co. for fees billed on January 11, 15 Santana Rey withdrew $4, 620 cash from the company for personal use. 23 The company sold merchandise with a $2,620 cost for $3, 290 on credit to Delta Co., invoice dated February 23. 26 The company paid cash to Lyn Addie for eight days' work at $205 per day. 27 The company reimbursed Santana Rey for business automobile mileage (400 miles at $0.32 per mile). 8 The company purchased $2, 890 of computer supplies from Harris Oorfice Products on credit, invoice dated March 8. 9 The company received the balance due from Delta Co. for merchandise sold on February 23, 11 The company paid $770 cash for minor repairs to the company's computer. 16 The company received $5, 330 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due to Harris Office Products, consisting of amounts created on December 15 (of $1, 150) and March 8. 24 The company billed Easy Leasing for $9, 117 of computing services provided. 25 The company sold merchandise with a $2,172 cost for $2,870 on credit to Wildcat Services, invaice dated March 25. 30 The company sold merchandise with a $1,058 cost for $2, 24e on credit to IFM Company, invoice dated March 30. 31 The company reimbursed Santana Rey for business automobile mileage (1,000 miles at $0.32 per mile). Mar. The following additional facts are available for preparing adjustments on March 31 prior to financial statement preparation: a. The March 31 amount of computer supplies still available totals $2,165. b. Three more months have expired since the company purchased its annual insurance policy at a $2,616 cost for 12 months of coverage. c. Lyn Addie has not been paid for seven days of work at the rate of $205 per day d. Three months have passed since any prepaid rent has been transferred to expense. The monthly rent expense is $905. e. Depreciation on the computer equipment for January 1 through March 31 is $1,080. f. Depreciation on the office equipment for January 1 through March 31 is $270. g. The March 31 amount of merchandise inventory still available totals $524. Part 2 2. Post the journal entries in part 1 to the accounts in the company's general ledger. (Note: Begin with the ledger's post-clc adjusted balances as of December 31, 2017) (Record the transactions in the order presented. Do not skip rows.) 101 Cash 106.1 Accounts Receivable-Alex's Engineering Co. Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 0. 106.2 Accounts Receivable-Wildcat Services 106.3 Accounts Receivable-Easy Leasing Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 106.4 Accounts Receivable-IFM Co. 106.5 Accounts Receivable-Liu Corporation Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 106.6 Accounts Receivable-Gomez Co. 106.7 Accounts Receivable-Delta Co. Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec 31 Dale Debit Credit Balance Date Debit Crodit Balance Dec. 31 Dec. 31 119 Merchandise Inventory 126 Computer Supplies Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 128 Prepaid Insurance 131 Prepaid Rent Date Debit Credit Balance Date Dobit Crodit Balance Dec. 31 Dec, 31 163 Office Equipment 164 Accumulated DeprociationOffice Equipment Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 167 Computer Equipment 168 Accumulated Depreciation-Computer Equipment Date Debit Credit Balance Date Debit Credit Balance Dec 31 Dec. 31 201 Accounts Payable 210 Wages Payable Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec. 31 236 Unearned Computer Services Revenue 301 S. Rey, Capital Date Debit Credit Balance Date Debit Credit Balance Dec. 31 Dec, 31 302 S. Rey, Withdrawals 403 Computer Services Revonue Date Debit Credit Balance Date Debit Credit Balance 413 Sales 414 Sales Returns and Allowances Date Debit Credit Balance Date Debit Credit Balance Scld 415 Sales Discounts 502 Cost of Goods Sold Date Debit Credit Balance Date Debit Credit Balance 612 Depreciation Expense-Office Equipment 613 Dopreciation Expense-Computer Equipment Date Debit Credit Balance Date Debit Credit Balance 623 Wages Expense 637 Insurance Expense Date Debit Credit Balance Date Debit Credit Balance 640 Rent Expense 652 Computer Supplies Expense Debit Credit Balance Date Dobit Credit Balance Date 655 Advertising Expense 676 Mileage Expense Balance Date Debit Credit Balance Date Debit Credit 677 Miscellaneous Expenses 684 Repairs Expense-Computer Date Debit Credit Balance Date Debit Credit Balance

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Date General journal Debit Credit Jan 4 Wages payable 4205 820 Wages expense 205 Cash 5205 1025 Wage... View the full answer