Question

Exercise 2-8 Preparing T-accounts (ledger) and a trial balance LO P2 Following are the transactions of a new company called Pose-for-Pics Aug. 1 Madison Harris, the owner, invested $7,400 cash and $34,400 of photography equipment in the company in exchange for common stock. 2 The company paid $3,000 cash for an insurance policy covering the next 24 months 5 The company purchased office supplies for $970 cash. 20 The company received $4,231 cash in photography fees earned. 31 The company paid $765 cash for August utilities. Required: 1. Post the transactions to the T-accounts 2. Use the amounts from the T-accounts in Requirement (1) to prepare an August 31 trial balance for Pose-for-Pics. Complete this question by entering your answers in the tabs below. Required Required Post the transactions to the T-accounts. Cash Office Supplies Prepaid Insurance Photography Equipment Common Stock Photography Fees Earne Utilities Expense Balance Red Required 2 >

Answer 1

Solution:

Posting of entries in T shaped Account
Cash A/c
Particulars			$		Particulars			$
To Common Stock			7,400		By Prepaid Insurance			3,000
TO Photography Fees			4,231		By Office Supplies			970
					By Utilities Expense			765
					By Balance c/d			6,896
			11,631					11,631
Prepaid Insurance
Particulars			$		Particulars			$
To Cash			3,000		By Balance c/d			3,000
			3,000					3,000
Common Stock
Particulars			$		Particulars			$
					By Cash			7,400
To Balance c/d			41,800		By Photography Equip.			34,400
			41,800					41,800
Utilities Expense A/c
Particulars			$		Particulars			$
To Cash			765		By Balance c/d			765
			2,500					2,500
Office Supplies
Particulars			$		Particulars			$
To Cash			970		By Balance c/d			970
Photography Equipment
Particulars			$		Particulars			$
To Common Stock			34,400		By Balance c/d			34,400
			34,400					34,400
Photography Fees Earned
Particulars			$		Particulars			$
To Balance c/d			4,231		To Cash			4,231
			4,231					4,231

POSE-FOR-PICS Trial Balance
Accounts Name				Debit		Credit
Cash				6,896
Prepaid Insurance				3,000
Common Stock						41,800
Utilities Expense A/c				765
Office Supplies				970
Photography Equipment				34,400
Photography Fees Earned						4,231
				46,031		46031