Question

Min invested $18,000 cash in the business. Paid $7,540 cash for monthly rent expense for May. Paid $4,600 cash for this year’s insurance premium beginning immediately. Purchased office supplies for $890 cash. Purchased $12,900 of office equipment on credit (with accounts payable). Received $36,000 cash for engineering services provided in May. Min withdrew $3,370 cash for personal use. Required 1. Prepare a trial balance for this business as of the end of May 2.

Answer 1

Answer:

$\left[\begin{array}{ccc} Account& DEBIT& CREDIT\\ Cash&37,600&-\\ Prepaid insurance&4,600&\\ Office supplies&890&-\\ office equipment&12,900&\\ accouts payable&-&12,900\\ Capital Account&&18,000\\ drawins&3,370&\\ Sales revenue&&36,000\\ Rent expense&7,540&\\ Total&66,900&66,900\\\end{array}\right]$

Explanation:

We must do ledger for each accounts, most of them only got one transaction so we just post them directly.

For cash we must do it as there are several transaction:

       CASH

DEBIT          CREDIT

18,000

                    (7,540)

                    (4,600)

                       (890)

36,000

                    (3,370)

37,600

Assets and expenses goes into debit column

Liabilities, equity and revenues into credit column