Chapter 2 Serial Problem
On
October 1, 2011, Santana Rey launched a computer services company called
Business Solutions, which provides consulting services, computer system
installations, and custom program development. Rey adopts the calendar
year for reporting purposes and expects to prepare the company’s first
set of financial statements on December 31, 2011. The company’s initial
chart of accounts follows.
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Oct.
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1
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S. Rey invested $48,000 cash, a $22,000 computer system, and $8,000 of
office equipment in the company in exchange for its common stock.
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2
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The company paid $3,260 cash for four months' rent. (Hint: Debit
Prepaid Rent for $3,260.)
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3
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The company purchased $1,380 of computer supplies on credit from Harris
Office Products.
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5
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The company paid $2,160 cash for one year's premium on a property and
liability insurance policy. (Hint: Debit Prepaid Insurance for
$2,160.)
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6
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The company billed Easy Leasing $5,500 for services performed in
installing a new Web server.
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8
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The company paid $1,380 cash for the computer supplies purchased from
Harris Office Products on October 3.
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10
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The company hired Lyn Addie as a part-time assistant for $145 per day,
as needed.
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12
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The company billed Easy Leasing another $2,200 for services performed.
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15
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The company received $5,500 cash from Easy Leasing as partial payment on
its account.
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17
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The company paid $755 cash to repair computer equipment that was damaged
when moving it.
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20
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The company paid $1,688 cash for advertisements published in the local
newspaper.
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22
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The company received $2,200 cash from Easy Leasing on its account.
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28
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The company billed IFM Company $5,408 for services performed.
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31
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The company paid $1,015 cash for Lyn Addie’s wages for seven days' work.
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31
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The company paid $3,400 cash for dividends.
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Nov.
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1
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The company reimbursed S. Rey in cash for business automobile mileage
allowance (Rey logged 1,000 miles at $0.25 per mile).
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2
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The company received $5,133 cash from Liu Corporation for computer
services performed.
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5
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The company purchased computer supplies for $1,100 cash from Harris
Office Products.
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8
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The company billed Gomez Co. $6,068 for services performed.
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13
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The company received notification from Alex's Engineering Co. that
Business Solutions' bid of $4,850 for an upcoming project is accepted.
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18
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The company received $1,508 cash from IFM Company as partial payment of
the October 28 bill.
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22
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The company donated $250 cash to the United Way in the company's name.
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24
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The company completed work for Alex's Engineering Co. and sent it a bill
for $4,850.
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25
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The company sent another bill to IFM Company for the past-due amount of
$3,900.
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28
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The company reimbursed S. Rey in cash for business automobile mileage
(1,200 miles at $0.25 per mile).
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30
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The company paid $2,030 cash for Lyn Addie's wages for 14 days' work.
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30
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The company paid $1,500 cash for dividends.
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Required:
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1. Prepare journal entries to record each of the above
transactions for Business Solutions. (In
cases where no entry is required, please select the option "No journal
entry required" for your answer to grade correctly. Leave no cells blank
- be certain to enter "0" wherever required. Omit the "$" sign in your
response.)
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