Karen Furber, a photographer, opened Gratitude in Photography on January 1, 2015.
Selected transactions from the first month are below:
a. Transferred cash into the business, $20,000.
b. Purchased used automobile for $22,300, paying $5,000 in cash and giving a note payable for the remainder.
c. Paid cash for insurance for the following year, $900.
d. Purchased camera equipment on account, $7,000.
e. Received invoice, due in February, for van repairs, $560.
f. Paid installment due on note payable, $300.
g. Paid gas and oil on automobile for January, $400.
Instructions
1. Record the above transactions directly in the following T accounts, without journalizing: Cash; Prepaid Insurance; Automobiles; Camera Equipment; Accounts Payable; Note Payable; Karen Furber, Capital; Automobile Expense. To the left of each amount entered into the accounts, place the appropriate letter to identify the transaction.
2. Determine account balances of the T accounts. Accounts containing a single entry only (such as Prepaid Insurance) do not need a balance.
3. Prepare an unadjusted trial balance as at January 31, 2015.