JOURNALIZING AND POSTING TRANSACTIONS AND PREPARING A TRIAL BALANCE J. B. Hoyt opened a training center at the marina where he provides private water-skiing lessons. He rented a small building at the marina and has a part-time worker to assist him. His chart of accounts is shown below.

Water Walking by Hoyt

Chart of Accounts

Assets.................Revenues

101 Cash...............401 Training Fees

142 Office Supplies

183 Skiing................Equipment Expenses

.....................511 Wages Expense

Liabilities.................521 Rent Expense

202 Accounts Payable..........525 Telephone Expense

...................526 Transportation Expense

Owner’s Equity...............533 Electricity Expense

311 J. B. Hoyt, Capital..........537 Repair Expense

312 J. B. Hoyt, Drawing..........549 Miscellaneous Expense

313 Income Summary

Transactions for the first month of business are as follows:

July 1 Invested cash in the business, $5,000.

2 Paid rent for the month, $250.

3 Purchased office supplies, $150.

4 Purchased skiing equipment on account from Water Fun, Inc., $2,000.

6 Paid telephone bill, $36.

7 Received cash for skiing lessons, $200.

10 Paid electricity bill, $28.

12 Paid part-time worker, $250.

14 Received cash for skiing lessons, $300.

16 Paid for gas and oil (transportation expense), $60.

17 Received cash for skiing lessons, $250.

20 Paid for repair to ski rope, $20.

21 Made payment on account for skiing equipment previously purchased, $100.

24 Received cash for skiing lessons, $310.

26 Paid for award certificates (miscellaneous expense), $18.

28 Paid part-time worker, $250.

30 Received cash for skiing lessons, $230.

31 Paid for repair to life jacket, $20.

REQUIRED

1. Journalize the transactions for July using the modified cash basis and page 1 of a combination journal. Set up special columns for Training Fees (credit), Wages Expense (debit), and Repair Expense (debit).

2. Determine the cash balance as of July 14, 20--.

3. Prove the combination journal.

4. Set up general ledger accounts from the chart of accounts and post the transactions from the combination journal.

5. Prepare a trial balance.