X Company is a merchandiser and prepares monthly financial statements. The follo
ID: 2598398 • Letter: X
Question
X Company is a merchandiser and prepares monthly financial statements. The following is its balance sheet at the beginning of January:
The following summary transactions occurred during January:
Sold stock to investors for $50,000.
Borrowed $30,000 from a bank.
Bought merchandise from suppliers, paying $3,715 and promising to pay $4,302 next month.
Bought equipment from a manufacturer, paying $31,200 and promising to pay $4,200 in three months.
Paid $2,843 to merchandise suppliers that it had promised to pay.
Sold merchandise, receiving $17,837 cash and promises to pay of $4,513; the merchandise that was sold previously cost $11,175.
Paid a total of $512 for rent and insurance in advance.
Received $2,712 from customers who had promised to pay.
Paid $5,260 for wages, utilties, and other miscellaneous expenses.
Note: Ignore adjusting entries.
4. What was the cash balance on January 31? $109,295
5. What were total equities on January 31?
The answer is not 341350 or 346876
6. What was net income in January?
5649 and 11175 are incorrect
Balance Sheet January 1Explanation / Answer
5.
6. Net income in January
Paid in capital: Beginning balance $216464 Add: Issued 50000 $266464 Retained earnings: Beginning balance 69237 Add: Net income 5915 75152 Accounts payable (57186+4302+4200-2843) 62845 Wages payable 1140 Notes payable 31406 Bank loan payable 30000 Total equities $467007Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.