Question

Following are the transactions of a new company called Pose-for-Pics. Aug. 1 Madison Harris, the owner, invested $6,500 cash and $33,500 of photography equipment in the company in exchange for common stock. 2 The company paid $2,100 cash for an insurance policy covering the next 24 months. 5 The company purchased office supplies for $880 cash. 20 The company received $3,331 cash in photography fees earned. 31 The company paid $675 cash for August utilities.Prepare an August 31 trial balance for Pose-for-Pics.

Debit Credit
Cash
Offices
Prepaid insurance
Photography equipment
Common stock
Photography fees earned
Utilities expense
Totals

Answer 1

Step-by-step explanation:

Following are the transactions of a new company called Pose-for-Pics. Aug. 1 Madison Harris, the owner, invested $6,500 cash and $33,500 of photography equipment in the company in exchange for common stock.

2 The company paid $2,100 cash for an insurance policy covering the next 24 months. 5 The company purchased office supplies for $880 cash. 20 The company received $3,331 cash in photography fees earned. 31 The company paid $675 cash for August utilities.

Pose for Pics

Trial Balance

As at 31st August

Particulars Debit Credit

Cash 6,176

Photography Equipment 33,500

Common Stock 40,000

Prepaid Insurance 2,100

Office Supplies 880

Photography Fees 3.331

Utilities Expense 675

TOTAL 43,331 43,331

Note that with each expense involving cash, you have to add or less the amount from the original amount of cash at the start of the period, hence our final cash balance was derived by: 6,500-2100-880+3331-675 = 6176