Questions 4, 5, and 6 refer to the following information X Company is a merchand

Question

Questions 4, 5, and 6 refer to the following information X Company is a merchandiser and prepares monthly financial statements. The following is its balance sheet at the beginning of January Balance Sheet January 1 Assets Cash Accounts Receivable Inventory Prepaid Rent Equipment Total Assets Equities $62,531 1,429 31,548 239,303 73,404 $408,215 $51,199 Accounts Payable 34,008 Wages Payable 78,002 Notes Payable 6,291 Paid-In Capital 238,715 Retained Earnings $408,215 Total Equities The following summary transactions occurred during January 1. Sold stock to investors for $47,000 2. Borrowed $28,000 from a bank. 3. Bought merchandise from suppliers, paying $3,929 and promising to pay $4,231 next month 4. Bought equipment from a manufacturer, paying $32,900 and promising to pay $4,500 in three months. 5. Paid $2,762 to merchandise suppliers that it had promised to pay 6. Sold merchandise, receiving $17,424 cash and promises to pay of $4,066; the merchandise that was sold previously cost $10,745 7. Paid a total of $594 for rent and insurance in advance 8. Received $2,763 from customers who had promised to pay 9. Paid $5,270 for wages, utilties, and other miscellaneous expenses. Note: Ignore adjusting entries. 4. What was the cash balance on January 31? Submit Answer Tries 0/3 5. What were total equities on January 31? Submit Ane Tries 0/3 6. What was net income in January? Submit Answer Tries 0/3

Explanation / Answer

Solution:-

4. Cash balance on january 31:-

$100,931

Explanation:- 51,199 + 47,000 + 28,000 -3,929 - 32,900 - 2,762 + 17,424 - 594 + 2,763 - 5,270 = $ 100,931.

5. What were total equities on january 31:-

$494,659

Explanation:

408,215 + 47,000 + 28,000 + 4,231 + 4,500 - 2,762 + 5,475 = $ 494,659

6. What was net income in January:-

$5,475

Explanation:- (17,424 + 4,066 - 10,745) - 5,270 = $ 5,475

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