X Company, a merchandising company, had the following transactions during the ye

Question

X Company, a merchandising company, had the following transactions during the year:

  1. Received $8,109 in cash contributions from the owners.
  2. Purchased $8,771 worth of merchandise on account from suppliers.
  3. Sold merchandise on account to customers for $10,582; the merchandise cost X Company $7,407.
  4. Paid $3,026 to suppliers for merchandise that X Company had previously purchased on account.
  5. Collected $3,796 from customers who had previously purchased merchandise on account.
  6. Bought equipment for $9,871 with a down payment of $5,154 and a $4,717 loan from the bank.
  7. Paid wages of $1,017.
  8. Recognized the expiration of $507 of prepaid rent.

If total equities at the beginning of the year were $10,742, what were total equities at the end of the year?

Explanation / Answer

Total equities at the end of the year = 10742+8109+(10582-7407)-1017-507= $20502

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