Question

Following are the transactions of a new company called Pose-for-Pics.

Aug.		1		Madison Harris, the owner, invested $8,000 cash and $34,400 of photography equipment in the company in exchange for common stock.
		2		The company paid $3,000 cash for an insurance policy covering the next 24 months.
		5		The company purchased office supplies for $1,520 cash.
		20		The company received $4,000 cash in photography fees earned.
		31		The company paid $884 cash for August utilities.

Prepare general journal entries for the above transactions.

Answer 1

Prepare general journal entries for the above transactions.

Date	accounts & explanation	debit	credit
Aug 1	Cash	8000
	Photography Equipment	34400
	Common stock		42400
	(To record exchange of common stock)
Aug 2	Prepaid insurance	3000
	Cash		3000
	(To record insurance paid)
Aug 5	Office supplies	1520
	Cash		1520
	(To record office supplies purchased)
Aug 20	Cash	4000
	Fees Revenue		4000
	(To record fees earned)
Aug 31	Utilities expense	884
	Cash		884
	(To record utilities expenses paid)