Following are the transactions of a new company called Pose-for-Pics. Aug. 1 Madison Harris, the owner, invested $10,250 cash and $44,075 of photography equipment in the company. 2 The company paid $2,200 cash for an insurance policy covering the next 24 months. 5 The company purchased office supplies for $1,948 cash. 20 The company received $2,600 cash in photography fees earned. 31 The company paid $878 cash for August utilities. Prepare an August 31 trial balance for Pose-for-Pics. A. Debit CreditB. CashC. OfficesD. Prepaid insuranceE. Photography equipmentF. Common stockG. Photography fees earnedH. Utilities expenseI. Totals

Trial Balance as at Aug 31

                                  Debit              Credit

Cash                         $7,824

Equipment             $44,075

Capital                                            $54,325

Insurance Prepaid $2,200

Offices Supplies     $1,948

Revenue Earned                             $2,600

Utilities Expense       $878

Totals                   $56,925           $56,925

Explanation:

The First Step is to Record the Entries

Record

Aug. 1

Cash $10,250 (debit)

Equipment $44,075 (debit)

Capital $54,325 (credit)

Aug 2.

Insurance Prepaid $2,200 (debit)

Cash $2,200 (credit)

Aug 5.

Offices Supplies $1,948 (debit)

Cash $1,948 (credit)

Aug 20

Cash $2,600 (debit)

Revenue Earned $2,600 (credit)

Aug 31

Utilities Expense $878 (debit)

Cash $878 (credit)

The second step is to determine Account Balances

Account Balances

Cash $10,250 - $2,200 - $1,948 + $2,600 - $878 = $7,824 (debit)

Equipment $44,075 (debit)

Capital $54,325 (credit)

Insurance Prepaid $2,200 (debit)

Offices Supplies $1,948 (debit)

Revenue Earned $2,600 (credit)

Utilities Expense $878 (debit)

The last and final step is to create a Trial Balance. A Trial Balance is a list of Balances extracted from Ledger Accounts.

Trial Balance as at Aug 31

                                  Debit              Credit

Cash                         $7,824

Equipment             $44,075

Capital                                            $54,325

Insurance Prepaid $2,200

Offices Supplies     $1,948

Revenue Earned                             $2,600

Utilities Expense       $878

Totals                   $56,925           $56,925

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