After the success of the company\'s first two months, Santana Rey continues to o
ID: 2340775 • Letter: A
Question
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. Account Title Debit S38,664 13,118 2,545 1,920 3,040 8,200 101 Cash 106 Accounts receivable 126 Computer supplies 128 Prepaid insurance 131 Prepaid rent 163 office equipment 164 Accumulated depreciation-Office equipment 167 Computer equipment 168 Accumulated depreciation-Computer equipment 201 Accounts payable 210 Wages payable 236 Unearned computer services revenue 301 . Rey, Capital 302 S.Rey, Withdrawals 03 Computer services revenue 612 Depreciation expense-office equipment 13 Depreciation expense Computer equipment 623 Wages expense 37 Inaurance expense 640 Rent expense 652 Computer aupplies expense 655 Advertiaing expense 676 Mileage expense 677 Miscellaneous expenses 84 Repairs expense Computer 72,000 5,700 30,104 2,450 1,658 654 250 Totala $102,104 $102,104 Business Solutions had the following transactions and events in December 2017 Dec. Paid $980 cash to Billside Mall for Business Solutions' share of mall advertising costs 3 Paid $440 cash for minor repairs to the company s computer 4 Received $4,650 cash from Alex' Engineering Co. for the receivable from November 10 Paid cash to Lyn Addie for aix days of work at the rate of $105 per day 14 Notified by Alex'8 Engineering Co. that Business Solutions' bid of $7,300 on a proposed project has beern accepted. Alex's paid a $2,500 cash advance to Business Solutions 15 Purchased $2,000 of computer supplies on credit from Harris office ProductsExplanation / Answer
CASH Debit Credit Bal $38,664 Advertising Expense $980 Accounts Receivable $4,650 Repairs $440 Unearned revenue $2,500 Wages 630 Computer service revenue $6,025 Mileage Expense 124 Accounts Receivable $3,500 S.Roy, withdrawal $1,500 Bal $51,665 $55,339 $55,339 ACCOUNTS RECEIVABLE Debit Credit Bal $13,118 Cash $4,650 Cash $3,500 Bal 4968 $13,118 $13,118 COMPUTER SUPPLIES Debit Credit Bal $2,545 Supplies Expense $3,945 Accounts Payable $2,000 Bal 600 $4,545 $4,545 PREPAID INSURANCE Debit Credit Bal $1,920 Insurance Expense $480 Bal 1440 $1,920 $1,920 PREPAID RENT Debit Credit Bal $3,040 Rent Expense $2,280 Bal 760 $3,040 $3,040 ACCUMULATED DEPRECIATION - OFFICE EQUIPMENT Debit Credit Bal $1,450 Depreciation $1,450 $1,450 $1,450 ACCUMULATED DEPRECIATION - COMPUTER EQUIPMENT Debit Credit Bal $410 Depreciation Expense $410 $410 $410 ACCOUNTS PAYABLE Debit Credit Bal $2,000 Computer Supplies $2,000 $2,000 $2,000 WAGES PAYABLE Debit Credit Wages Expense 416 Bal $416 416 416 UNEARNED COMPUTER SERVICE REVENUE Debit Credit Bal $0 Bal $2,500 Cash $2,500 $2,500 $2,500 S. ROY, WITHDRAWALS Debit Credit Bal $5,700 Bal $7,200 Cash $1,500 $7,200 $7,200 COMPUTER SERVICE REVENUE Debit Credit Bal $30,104 Cash $6,025 Bal $36,129 $36,129 $36,129 DEPRECIATION - OFFICE EQUIPMENT Debit Credit Accumulated Depreciation $410 Bal $410 $410 $410 DEPRECIATION - COMPUTER EQUIPMENT Debit Credit Accumulated Depreciation $1,450 Bal $1,450 $1,450 $1,450 WAGES EXPENSE Debit Credit Bal $2,450 Cash 630 Wages Payable $416 Bal $3,496 $3,496 $3,496 INSURANCE EXPENSE Debit Credit Prepaid Insurance $480 Bal $480 $480 $480 RENT EXPENSE Debit Credit Prepaid Rent $2,280 Bal $2,280 $2,280 $2,280 COMPUTER SUPPLIES EXPENSE Debit Credit Supplies Expense $3,945 Bal $3,945 $3,945 $3,945 ADVERTISING EXPENSE Debit Credit Bal $1,658 Bal $2,638 Cash $980 $2,638 $2,638 MILEAGE EXPENSE Debit Credit Bal $654 Cash 124 Bal $778 $778 $778 REPAIRS EXPENSE - COMPUTER Debit Credit Bal $705 Cash $440 Bal $1,145 $1,145 $1,145 BUSINESS SOLUTIONS TRIAL BALANCE AS OF 31ST DECEMBER Debit Credit Cash $51,665 Accounts Receivable 4968 Computer Supplies 600 Prepaid Insurance 1440 Prepaid Rent 760 Office Equipment $8,200 Accumulated Depreciation - Office Equipment $1,450 Computer Equipment $23,200 Accumulated Depreciation - Computer Equipment $410 Accounts Payable $2,000 Wages Payable $416 Unearned computer service revenue $2,500 S.Roy, Capital $72,000 S.Roy, Withdrawals $7,200 Computer Service Revenue $36,129 Depreciation Expense - Office Equipment $410 Depreciation Expense - Computer Equipment $1,450 Wages Expense $3,496 Insurance Expense $480 Rent Expense $2,280 Computer Supplies Expense $3,945 Advertising Expense $2,638 Mileage Expense $778 Miscellaneuos Expense $250 Repairs Expense - Computer $1,145 Totals $114,905 $114,905 BUSINESS SOLUTIONS INCOME STATEMENT For Three months ended December 31, 2017 Computer Service Revenue $36,129 Less : Expenses Wages Expense $3,496 Insurance Expense $480 Rent Expense $2,280 Depreciation 1860 Computer Supplies Expense $3,945 Advertising Expense $2,638 Mileage Expense $778 Miscellaneous Expense $250 Repaird Expense - Computer $1,145 $16,872 Net Income $19,257 BUSINESS SOLUTIONS OWNERS EQUITY For Three months ended December 31, 2017 S Roy Capital $72,000 Add : Net Income $19,257 Less : Withdrawals ($7,200) S Roy Capital, Ending $84,057 BUSINESS SOLUTIONS BALANCE SHEET As on 31st December 2017 ASSETS Cash $51,665 Accounts Receivable 4968 Computer Supplies $600 Prepaid Insurance 1440 Prepaid Rent $760 Total Current Assets $59,433 Fixed Assets Computer Equipment $23,200 Less : Accumulated Depreciation $410 $22,790 Office Equipment $8,200 Less : Accumulated Depreciation $1,450 $6,750 Total Fixed Assets $29,540 Total Assets $88,973 LIABILITIES AND OWNERS EQUITY Accounts Payable $2,000 Wages Payable $416 Unearned computer service revenue $2,500 Total Current Liabilities $4,916 Owners Equity S, Roy Capital $84,057 Total Liabilities and Owners Equity $88,973