For Pose for Pics, prepare journal entries, T-accounts and a trial balance
Pose for Pics
Preparing journal entries and trial balances
Exercise 2-4
Prepare general journal entries for the following transaction of a new business called Pose for Pics. (please use Excel)
Aug. 1 -Hashim Paris, the owner, invested $7500 cash and $32500 of photography equipment in the business.
Aug. 1 -paid $3000 cash for an insurance policy covering the next 24 months.
aug 5- purchased office supplies for $1400 cash
aug 20- received $2650 cash in photography fees earned.
aug 31- paid $875 cash for August utilities.
Use the information in Exercise 2-4 to prepare an August 31 trial balance for Pose-for-Pics. Open these T-accounts: Cash; Office Supplies; Prepaid Insurance; Photography Equipment; H. Paris, Capital; Photography Fees Earned; and Utilities Expense. Post the general journal entries to these T-accounts (which will serve as the ledger), and prepare a trial balance.
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I want to know if you ranswer is right
To prepare the journal entries, T-accounts, and trial balance for Pose for Pics, follow these steps:
1. Open an Excel spreadsheet or use any accounting software to create the journal entries, T-accounts, and trial balance.
2. Label the columns of the spreadsheet as follows: Date, Account Title, Account Number (optional), Debit, Credit.
3. Input the journal entries using the information provided:
- Aug. 1: Hashim Paris invested $7500 cash and $32500 of photography equipment in the business.
- Debit Cash: $7500
- Debit Photography Equipment: $32500
- Credit H. Paris, Capital: $40000 (total investment)
- Aug. 1: Paid $3000 cash for an insurance policy covering the next 24 months.
- Debit Prepaid Insurance: $3000
- Credit Cash: $3000
- Aug. 5: Purchased office supplies for $1400 cash.
- Debit Office Supplies: $1400
- Credit Cash: $1400
- Aug. 20: Received $2650 cash in photography fees earned.
- Debit Cash: $2650
- Credit Photography Fees Earned: $2650
- Aug. 31: Paid $875 cash for August utilities.
- Debit Utilities Expense: $875
- Credit Cash: $875
4. Create T-accounts for the following accounts: Cash, Office Supplies, Prepaid Insurance, Photography Equipment, H. Paris, Capital, Photography Fees Earned, and Utilities Expense.
5. Post the journal entries to the respective T-accounts. For each entry, update the balance in the respective account by adding or subtracting the debit and credit amounts.
6. After posting all the journal entries, calculate the closing balances for each account and transfer them to the trial balance.
7. Prepare the trial balance by listing the account titles and their corresponding debit or credit balances.
The trial balance should include the following accounts:
- Cash
- Office Supplies
- Prepaid Insurance
- Photography Equipment
- H. Paris, Capital
- Photography Fees Earned
- Utilities Expense
Ensure that the total debits match the total credits in the trial balance.
Note: Since I am an AI text-based bot, I cannot prepare the Excel spreadsheet for you, but I have provided the steps to help you prepare the entries and trial balance for Pose for Pics.