Prepare an August 31 trial balance for Pose-for Pics.
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Prepare general journal entries for the following transactions of a new business called Pose for Pics. Aug 1 Hashim Paris, the owner, invested $7,500 cash and 32,500 of photography equipment in the business. Aug. q, Paid $3,000 cash for an insurance policy covering the next 24 months. Purchased office suppies for $1,400 cash. Received $2,650 cash in photography fees earned. Paid $872 cash for August utilities
To prepare an August 31 trial balance for Pose-for Pics, you will need the company's general ledger. The general ledger is a collection of all the accounts used by the company to record its transactions. Each account contains a record of the company's assets, liabilities, equity, revenues, and expenses.
Here are the steps to prepare an August 31 trial balance:
1. Gather the general ledger: Collect all the account balances from the general ledger for the period ending on August 31.
2. Review the accounts: Check each account to ensure that all transactions for the month have been properly recorded. Make any necessary adjustments or corrections.
3. Separate the accounts: Categorize the accounts into different sections. Common sections include assets, liabilities, equity, revenues, and expenses.
4. List the balances: Create a table with two columns. In the first column, list the account names. In the second column, record the account balances as of August 31.
5. Add the debits and credits: Determine whether each account has a debit or credit balance. Debit balances are recorded on the left side of the table, while credit balances are recorded on the right side.
6. Calculate the total debits and credits: Add up all the debit balances and credit balances separately. Compare the totals to ensure they are equal. If they are not equal, you may have made an error in recording one or more transactions.
7. Prepare the trial balance: Create a final trial balance by listing the account names and their respective balances in debit or credit format.
Here is an example of how the trial balance might look:
Trial Balance as of August 31, 20XX
| Account Name | Debit ($) | Credit ($) |
|-----------------|------------|------------|
| Cash | 10,000 | |
| Accounts Receivable | 5,000 | |
| Prepaid Rent | 800 | |
| Equipment | 15,000 | |
| Accumulated Depreciation | | 1,000 |
| Accounts Payable | | 3,000 |
| Utilities Payable | | 500 |
| Notes Payable | | 10,000 |
| Sales Revenue | | 25,000 |
| Rent Revenue | | 1,200 |
| Salary Expense | | 2,000 |
| Advertising Expense | | 1,500 |
| Total | 31,800 | 43,200 |
Make sure to date the trial balance as of August 31, and remember that the debit and credit columns should balance out to the same total.