Question

I have completed everything but section 2b. I have plugged in the information, but seem to be missing something.

Serial Problem Business Solutions LO P1, P2, P3, P4, P5

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.

No.	Account Title	Debit			Credit
101	Cash	$	38,264
106	Accounts receivable		12,618
126	Computer supplies		2,545
128	Prepaid insurance		2,220
131	Prepaid rent		3,300
163	Office equipment		8,000
164	Accumulated depreciation—Office equipment				$	0
167	Computer equipment		20,000
168	Accumulated depreciation—Computer equipment					0
201	Accounts payable					0
210	Wages payable					0
236	Unearned computer services revenue					0
307	Common stock					73,000
318	Retained earnings					0
319	Dividends		5,600
403	Computer services revenue					25,659
612	Depreciation expense—Office equipment		0
613	Depreciation expense—Computer equipment		0
623	Wages expense		2,625
637	Insurance expense		0
640	Rent expense		0
652	Computer supplies expense		0
655	Advertising expense		1,728
676	Mileage expense		704
677	Miscellaneous expenses		250
684	Repairs expense—Computer		805
	Totals	$	98,659		$	98,659

Business Solutions had the following transactions and events in December 2017.

Dec.	2		Paid $1,025 cash to Hillside Mall for Business Solutions’ share of mall advertising costs.
	3		Paid $500 cash for minor repairs to the company’s computer.
	4		Received $3,950 cash from Alex’s Engineering Co. for the receivable from November.
	10		Paid cash to Lyn Addie for six days of work at the rate of $125 per day.
	14		Notified by Alex’s Engineering Co. that Business Solutions’ bid of $7,000 on a proposed project has been accepted. Alex’s paid a $1,500 cash advance to Business Solutions.
	15		Purchased $1,100 of computer supplies on credit from Harris Office Products.
	16		Sent a reminder to Gomez Co. to pay the fee for services recorded on November 8.
	20		Completed a project for Liu Corporation and received $5,625 cash.
22–26			Took the week off for the holidays.
	28		Received $3,000 cash from Gomez Co. on its receivable.
	29		Reimbursed S. Rey for business automobile mileage (600 miles at $0.32 per mile).
	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:

1. The December 31 inventory count of computer supplies shows $580 still available.
2. Three months have expired since the 12-month insurance premium was paid in advance.
3. As of December 31, Lyn Addie has not been paid for four days of work at $125 per day.
4. The computer system, acquired on October 1, is expected to have a four-year life with no salvage value.
5. The office equipment, acquired on October 1, is expected to have a five-year life with no salvage value.
6. Three of the four months' prepaid rent has expired.

  
Required:
1. Prepare journal entries to record each of the December transactions and events for Business Solutions.
2-a. Prepare adjusting entries to reflect a through f.
2-b. Post the journal entries to record each of the December transactions, adjusting entries to the accounts in the ledger.
3. Prepare an adjusted trial balance as of December 31, 2017.
4. Prepare an income statement for the three months ended December 31, 2017.
5. Prepare a statement of retained earnings for the three months ended December 31, 2017.
6. Prepare a balance sheet as of December 31, 2017.
7. Record and post the necessary closing entries as of December 31, 2017.
8. Prepare a post-closing trial balance as of December 31, 2017.

Answers to 1:

No	Date	General Journal	Debit	Credit
1	Dec 02	Advertising expense	1,025
		Cash		1,025
2	Dec 03	Repairs expense—Computer	500
		Cash		500
3	Dec 04	Cash	3,950
		Accounts receivable		3,950
4	Dec 10	Wages expense	750
		Cash		750
5	Dec 14	Cash	1,500
		Unearned computer services revenue		1,500
6	Dec 15	Computer supplies	1,100
		Accounts payable		1,100
7	Dec 16	No journal entry required
8	Dec 20	Cash	5,625
		Computer services revenue		5,625
9	Dec 28	Cash	3,000
		Accounts receivable		3,000
10	Dec 29	Mileage expense	192
		Cash		192
11	Dec 31	Dividends	1,500
		Cash		1,500

Answers to 2a:

1	a.	Computer supplies expense	3,065
		Computer supplies		3,065
2	b.	Insurance expense	555
		Prepaid insurance		555
3	c.	Wages expense	500
		Wages payable		500
4	d.	Depreciation expense—Computer equipment	1,250
		Accumulated depreciation—Computer equipment		1,250
5	e.	Depreciation expense—Office equipment	400
		Accumulated depreciation—Office equipment		400
6	f.	Rent expense	2,475
		Prepaid rent		2,475

Answer 1

Make sure all figures as per trial balance matches.

Business Solutions Req 2-b T Accounts Date Debit Credit Balance Date Debit Credit Balance Date Debit Credit Balance Date Debit Credit Balance Cash Accounts Receivable Computer Supplies Prepaid Insurance Op bal $38,264 $38,264 Op bal $12,618 $ 12,618 Op bal $ 2,545 $ 2,545 Op bal $2,220 $ 2,220 2-Dec $ 1,025 $37,239 4-Dec $ 3,950 $ 8,668 15-Dec $ 1,100 $ 3,645 31-Dec $ 555 $ 1,665 3-Dec $ 500 $ 36,739 28-Dec $ 3,000 $ 5,668 31-Dec $ 3,065 $ 580 4-Dec $ 3,950 $ 40,689 10-Dec $ 750 $ 39,939 14-Dec $ 1,500 $ 41,439 20-Dec $ 5,625 $ 47,064 28-Dec $ 3,000 $ 50,064 29-Dec $ 192 $49,872 31-Dec $ 1,500 $ 48,372 Office Equip Accum. Depr. - Office Equip Computer Equipment Accum. Depr. - Computer Equip Op bal $ 8,000 $ 8,000 31-Dec $ 400 $ 400 Op bal $20,000 $ 20,000 31-Dec $ 1,250 $ 1,250 Prepaid Rent Accounts Payable Wages Payable Unearned Computer Services Revenue Op bal $ 3,300 $ 3,300 15-Dec $ 1,100 $ 1,100 31-Dec $ 500 $ 500 $ 1,500 $ 1,500 31-Dec $ 2,475 $ 825 Date Debit Credit Balance Date Debit Credit Balance Date Debit Credit Balance Date Debit Credit Balance Common Stock Dividends Income Summary Retained Earnings Op bal $ 73,000 $ 73,000 Op bal $ 5,600 $ 5,600 31-Dec $ 31,284 $ 31,284 Op bal $ - $ - 31-Dec $ 1,500 $ 7,100 31-Dec $ 16,824 $ 14,460 31-Dec $ 14,460 $ 14,460 31-Dec $ 7,100 $ - 31-Dec $ 14,460 $ - 31-Dec $ 7,100 $ 7,360 Computer Services Revenue Depreciation expense-Office Equipment Depreciation expense-Computer Equip Wages expense Op bal $ 25,659 $ 25,659 31-Dec $ 400 $ 40031-Dec $ 1,250 $ 1,250 Op bal $ 2,625 $ 2,625 20-Dec $ 5,625 $ 31,284 31-Dec $ 400 $ - 31-Dec $ 1,250 $ . 10-Dec $ 750 $ 3,375 31-Dec $ 31,284 $ - 31-Dec $ 500 $ 3,875 31-Dec $ 3,875 $ - Insurance expense Rent expense Computer supplies expense Advertising expense 31-Dec $ 555 $ 555 31-Dec $ 2,475 $ 2,475 31-Dec $ 3,065 $ 3,065 Op bal $ 1,728 $ 1,728 31-Dec $ 555 $ - 31-Dec $ 2,475 $ - 31-Dec $ 3,065 $ - 2-Dec $ 1,025 $ 2,753 31-Dec $ 2,753 $ . Mileage expense Miscellaneous expense Repairs expense-Computer Op bal $ 704 $ 704 Op bal $ 250 $ 250 Op bal $ 805 $ 805 29-Dec $ 192 $ 896 31-Dec $ 250 $ . 3-Dec $ 500 $ 1,305 31-Dec $ 896 $ . 31-Dec $ 1,305 $ -

Adjustments Debit Credit Income Statement Debit Credit Unadjusted TB Debit Credit 48,372 5,668 3,645 2,220 3,300 8,000 3,065 555 2,475 Adjusted TB Debit Credit 48,372 5,668 580 1,665 825 8,000 400 20,000 1,250 1,100 500 1,500 73,000 Balance Sheet Debit Credit 48,372 5,668 580 1,665 825 8,000 400 20,000 1,250 1,100 500 1,500 73,000 400 20,000 1,250 1,100 500 1,500 73,000 Business Solutions Account Names Cash Accounts Receivable Computer Supplies Prepaid Insurance Prepaid Rent Office Equipment Accumulated Depreciation Office Equipment Computer Equipment Accumulated Depreciation-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 expense Repairs expense-Computer Totals Net Income Totals 7,100 7,100 7,100 31,284 31,284 31,284 400 3,375 400 1,250 500 555 2,475 3,065 1,250 3,875 555 2,475 3,065 2,753 896 250 1,305 109,034 2,753 896 250 1,305 400 1,250 3,875 555 2,475 3,065 2,753 896 250 1,305 16,824 14,460 31,284 8,245 8,245 109,034 31,284 92,210 77,750 14,460 92,210 31,284 92,210