Business Solutions had the following transactions and events in December 2011 De
ID: 2372843 • Letter: B
Question
Business Solutions had the following transactions and events in December 2011
Dec2: Paid $1,025 Cash to Hillside Mall for Susiness Colutions share of mall advertising costs
Dec3: Paid $500 Cash for minor reparis to the companys computer
Dec4: Received $3,950 cash from Alex Eng. Co, for the reecieveable from November.
Dec 10: Paid Cash to Lynn for six days of work at 125 per day
Dec14: Notified by Alex Eng. Co, rhat Busniess Solutions bid of $7000 on a proposed project was accepted. Alex paid $1.500 cash advance to Business Solutions
Dec15: Purchased $1,100 of computer supplies on credit from Harris Office Products
Dec 20: Completed a project for Liu Corp, and recieved $5,625 in cash
Dec: 28 Received $3000 cash from Gomez Co. on its recivable
Dec 29: Reimbursed S. Rey for business automobile milage at $.32 a mile
Dec 31: S.Rey withdrew $1500 cash from the company for personal use
The following additional facts are collected for the use in making adjusting entires prior to preparing the financial statements for the companies first three months
a. The December 31 inventory count of computer supplies shows $580 still available
b.Three months have expired since the 12- month insurance policy was paid in advance for $2220
c. as of december 31 lynn had not been paid for four days of work at 125 per day
d. the companys computer is expected to have a four year life with no slavage value $20,000 computer system
e. The office equipment is expected to have a five year life with no slavage value, paid $8,000
f. three of the four months prepaid rent has expired, paid $3,300 for four months
Required:
1. Prepare journal entries to record each of the december transactions and events for Business Solutions
2. Prepare adjusting entires to reflect 1-f and post those entries to the accounts in the ledger
3. Prepare an adjusted trial balance as of December 31
4. Prepare an income statement for the three months ended Dec 31, 2011
5. Prepare a statement of owners equity for the three months ended December 31,2011
6. Prepare a balance sheet as of December 31, 2011
Explanation / Answer
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