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 $6,see cash and $33,509 of photog company paid $2,100 cash for an insurance policy covering the next 24 month:s s The company purchased office supplies for $888 cash. 20 The company received $3,331 cash in photography fees earned. 31 The company paid $675 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 1 Required 2
Post the transactions to the T-accounts Cash ies Balance

Answer 1

A T-account is a two-column balance sheet used to track financial transactions. Transactions can be posted to T-accounts to show changes in specific accounts. This information can then be used to prepare a trial balance.

Step-by-step explanation:

A T-account is a balance sheet with a two-column format that helps organize and track a company's financial transactions. The T-shape is formed by a vertical line down the middle and a horizontal line under the column headings for 'Assets' and 'Liabilities'.

To post the transactions to the T-accounts, you would record the cash investment of $6,5009 in the Cash T-account, the insurance policy payment of $2,100 in the Insurance Expense T-account, the office supplies purchase of $888 in the Office Supplies T-account, and the photography fees earned of $3,331 in the Photography Fees Earned T-account. Then, you can use the balances from the T-accounts to prepare an August 31 trial balance for Pose-for-Pics.

Answer 2

Pose-for-Pics

1. T-accounts:

Cash Account

Date Accounts Titles Debit Credit

Aug. 1 Common Stock $6,500

Aug. 1 Prepaid Insurance $2,100

Aug. 1 Supplies 888

Aug. 20 Service Revenue 3,331

Aug. 31 Utilities Expense 675

Aug. 30 Ending balance $6,168

Common Stock

Date Accounts Titles Debit Credit

Aug. 1 Cash $6,500

Aug. 1 Equipment 33,509

Aug. 30 Ending Balance $40,009

Photography Equipment

Date Accounts Titles Debit Credit

Aug. 1 Common Stock $33,509

Prepaid Insurance

Date Accounts Titles Debit Credit

Aug. 1 Cash $2,100

Supplies

Date Accounts Titles Debit Credit

Aug. 1 Cash $888

Service Revenue

Date Accounts Titles Debit Credit

Aug. 20 Cash $3,331

Utilities Expense

Date Accounts Titles Debit Credit

Aug. 31 Cash $675

2. Pose-for-Pics

TRIAL BALANCE

As of August 31

Accounts Titles Debit Credit

Cash $6,168

Common Stock $40,009

Photography Equipment 33,509

Prepaid Insurance 2,100

Supplies 888

Service Revenue 3,331

Utilities Expense 675

Totals $43,340 $43,340

Step-by-step explanation:

Correctly posting the transactions of Pose-for-Pics to the general ledger ensures that the two sides of the Trial Balance are equal as of August 31. The balanced Trial Balance assures the arithmetical accuracy of the entries and postings in the general ledger. This trial balance will then form the basis for preparing the financial statements after effecting the necessary adjusting entries.