Question

1.      Prepare general journal entries to record these transactions. (Explanations
are not required.)
2.      Posted the above items to the ledger T-accounts.
3.      Prepare a Trial Balance for Truman Services at May 31, 2020.
Truman Services organized and opened for business on May 1st. During the month
the company completed the following transactions:
On May 1, The company received an initial investment of $25,000 cash and $10,000 of
computer equipment for common stock.
On May 2, paid $600 cash for an insurance premium covering the next 12 months.
On May 3, paid $1,400 for May's rent.
On May 6, purchased office supplies for $1,500, on credit.
On May 7, The company made its first sale to a customer and collected $3,000 cash.
On May 15, company makes sale to a second customer for $8,000 and sends a bill.
On May 18, company paid $1,000 cash to partially satisfy item recorded on May 6.
On May 30, company paid $6,000 cash in salaries to staff.
On May 31, company paid a $1,000 cash dividend.

Answer 1

1.

Date	General Journal	Debit	Credit
May 1	Cash	25,000
	Computer Equipment	10,000
	Common Stock		35,000
May 2	Insurance Expense (600/12*1)	50
	Prepaid Insurance(600/12*11)	550
	Cash		600
May 3	Rent Expense	1,400
	Cash		1,400
May 6	Office Supplies	1,500
	Accounts Payable		1,500
May 7	Cash	3,000
	Service Revenue		3,000
May 15	Bills Receivable	8,000
	Service Revenue		8,000
May 18	Accounts payable	1,000
	Cash		1,000
May 30	Salaries Expense	6,000
	Cash		6,000
May 31	Dividend	1,000
	Cash		1,000

2.

Cash
Date	Particulars	Amt	Date	Particulars	Amt
May 1	Common Stock	25,000	May 2	Insurance Expense	50
May 7	Service Revenue	3,000	May 2	Prepaid Insurance	550
			May 3	Rent	1,400
			May 18	Accounts payable	1,000
			May 30	Salaries Expense	6,000
			May 31	Dividend	1,000
			May 31	Balance	18,000
	Total	28,000		Total	28,000

Computer Equipment
Date	Particulars	Amt	Date	Particulars	Amt
May 1	Common Stock	10,000	May 31	Balance	10,000
	Total	10,000		Total	10,000

Insurance Expense
Date	Particulars	Amt	Date	Particulars	Amt
May 2	Cash	50	May 31	Balance	50
	Total	50		Total	50

Prepaid Insurance
Date	Particulars	Amt	Date	Particulars	Amt
May 2	Cash	550	May 31	Balance	550
	Total	550		Total	550

Bills Receivable
Date	Particulars	Amt	Date	Particulars	Amt
May 15	Service Revenue	8,000	May 31	Balance	8,000
	Total	8,000		Total	8,000

Rent Expense
Date	Particulars	Amt	Date	Particulars	Amt
May 3	Cash	1,400	May 31	Balance	1,400
	Total	1,400		Total	1,400

Salaries Expense
Date	Particulars	Amt	Date	Particulars	Amt
May 30	Cash	6,000	May 31	Balance	6000
	Total	6,000		Total	6,000

Dividend
Date	Particulars	Amt	Date	Particulars	Amt
May 31	Cash	1,000	May 31	Balance	1,000
	Total	1,000		Total	1,000

Office Supplies
Date	Particulars	Amt	Date	Particulars	Amt
May 6	Accounts payable	1,500	May 31	Balance	1,500
	Total	1,500		Total	1,500

Common Stock
Date	Particulars	Amt	Date	Particulars	Amt
May 31	Balance	35,000	May 1	Cash	25,000
			May 1	Computer Equipment	10,000
	Total	35,000		Total	35,000

Accounts Payable
Date	Particulars	Amt	Date	Particulars	Amt
May 18	Cash	1,000	May 6	Office Supplies	1,500
May 31	Balance	500
	Total	1,500		Total	1,500

Service Revenue
Date	Particulars	Amt	Date	Particulars	Amt
May 31	Balance	11,000	May 7	Cash	3,000
			May 15	Bills Receivable	8,000
	Total	11,000		Total	11,000

3.

Trial Balance
Accounts	Debit	Credit
Cash	18,000
Bills Receivable	8,000
Office Supplies	1,500
Computer Equipment	10,000
Accounts payable		500
Common Stock		35,000
Service Revenue		11,000
Insurance Expense	50
Prepaid Insurance	550
Rent Expense	1,400
Salaries Expense	6,000
Dividend	1,000
Total	46,500	46,500