PROBLEM 2-3A Journal entries and trial balance Objectives 2, 3, 4, 5 SPAGHET RASS 3. Total of Credit Column: $40,880 On July 1, 2006, Leon Cruz established an interior decorating business, Ingres De- signs. During the remainder of the month, Leon Cruz completed the following trans- actions related to the business: July 1. Leon transferred cash from a personal bank account to an account to be used for the business, $18,000. 5. Paid rent for period of July 5 to end of month, $1,500. 10. Purchased a truck for $15,000, paying $5,000 cash and giving a note payable for the remainder. 13. Purchased equipment on account, $4,500, 14. Purchased supplies for cash, $975. 15. Paid annual premiums on property and casualty insurance, $3,000. 15. Received cash for job completed, $4,100. 21. Paid creditor a portion of the amount owed for equipment purchased on July 13, $2,400 24. Recorded jobs completed on account and sent invoices to customers, $6,100. 26. Received an invoice for truck expenses, to be paid in August, $580, 27. Paid utilities expense, $950. 27. Paid miscellaneous expenses, $315. 29. Received cash from customers on account, $3,420. 30. Paid wages of employees, $2,500. 31, Withdrew cash for personal use, $2,000. Instructions 1. Journalize each transaction in a two-column journal, referring to the following chart of accounts in selecting the accounts to be debited and credited. (Do not insert the account numbers in the journal at this time.) Journal entry explanations may be omitted Chapter 2 Analyzing Transactions 89 11 Cash 31 Leon Cruz, Capital 12 Accounts Receivable 32 Leon Cruz, Drawing 13 Supplies 41 Fees Earned 14 Prepaid Insurance 51 Wages Expense 16 Equipment 53 Rent Expense 18 Truck 54 Utilities Expense 21 Notes Payable 55 Truck Expense 22 Accounts Payable 59 Miscellaneous Expense 2. Post the journal to a ledger of four-column accounts, inserting appropriate post- ing references as each item is posted. Extend the balances to the appropriate bal- ance columns after each transaction is posted. 3. Prepare a trial balance for Ingres Designs as of July 31, 2006