Balance Sheet January 1 Assets Cash Accounts Receivable Inventory Prepaid Rent E

Question

Balance Sheet January 1 Assets Cash Accounts Receivable Inventory Prepaid Rent Equipment Total Assets Equities 50,420 Accounts Payable 0,053 Wages Payable 78,451 Notes Payable 6,267 Paid-In Capital 228,906 Retained Earnings $56,461 1,176 33,802 229,815 72,843 $394,097 Total Equities $394,097 The following summary transactions occurred during January 1. Sold stock to investors for $49,000. 2. Borrowed $28,000 from a bank. 3. Bought merchandise from suppliers, paying $3,173 and promising to pay $5,002 next month. 4. Bought equipment from a manufacturer, paying $32,400 and promising to pay $4,900 in three months 5. Paid $3,093 to merchandise suppliers that it had promised to pay. 6. Sold merchandise, receiving $16,475 cash and promises to pay of $4,875; the merchandise that was sold previously cost $10,675 7. Paid a total of $549 for rent and insurance in advance. 8. Received $3,810 from customers who had promised to pay. 9. Paid $5,000 for wages, utilities, and other miscellaneous expenses Note: Ignore adjusting entries. 4. What was the cash balance on January 31? $103,490 You are correct. Your receipt no. is 152-7552 Previous Tries 5. What were total equities on January 31? 47846 Submit Ar Tries 2/3 Previous Tries 6. What was net income in January? 6 An-er | Incorrect. Tries 1/3 Previous Tries

Explanation / Answer

The total of equities would be as follows

Current equity total =394097

Add borrowed as it will increase liability. =28000

Add increase in trade payable. = 5002

Less payment to merchandise. = (3093)

Equipment payable. =4900

Less wages payablee etc. =( 5000)

Total equity on jan 31=423906

6.

The net income was

Sale = 21350

Less cost of goods sold = (10675)

Less wages and others. = (5000)

Net income = 5675

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