Entries Prepared from a Trial Balance and Proof of the Cash Balance (Appendix)

Russell Company was incorporated on January 1, 2010, with the issuance of capital stock in return for $120,000 of cash contributed by the owners. The only other transaction entered into prior to beginning operations was the issuance of a $50,000 note payable in exchange for equipment and fi xtures. The following trial balance was prepared at the end of the fi rst month by the bookkeeper for Russell Company:

Russell Company Trial Balance January 31, 2010 Account Titles Debits Credits Cash $ ?

Accounts Receivable 30,500 Equipment and Fixtures 50,000 Wages Payable $ 10,000 Notes Payable 50,000 Capital Stock 120,000 Service Revenue 60,500 Wage and Salary Expense 24,600 Advertising Expense 12,500 Rent Expense 5,200 Required 1. Determine the balance in the Cash account.

2. Identify all of the transactions that affected the Cash account during the month.

Use a T account to prove what the balance in Cash will be after all transactions are recorded.

AppendixLO1