Alpha Company began 2007 with the following Balance Sheet: Cash $128,000 Account

Question

Alpha Company began 2007 with the following Balance Sheet:
Cash $128,000
Accounts Receivable 42,000
Office Equipment 15,000
Total Assets $185,000

Accounts Payable $48,000

Capital Stock 100,000
Retained Earnings 37,000

Total Liabilities and Equity $185,000

Consider the following transactions for Alpha Company in 2007 and answer question 1 through 4:

Transaction
A. Collection of $36,000 Accounts Receivables.
B Cash sales of $68,000.
C. Sales on account of $125,000.
D. Alpha paid $185,000 in operating expenses.
E. Alpha paid $25,000 off in accounts payable.
F. On October 1, 2007, Alpha collected $24,000 for a one-year contract for services that were to begin on the date the money was received.
G. Alpha paid $10,000 in dividends to stockholders
H. Alpha sold another $150,000 in stock to investors for cash.
I. Alpha purchased $25,000 office equipment for cash
J. On December 31, 2007 an adjustment is made to reflect the 2007 income earned from the contract in transaction F.



1. The total change in cash for 2007 is:
a. a decrease of 33,000
b. an increase of 33,000
c. an increase of 135,000
d. an increase of 194,000

2. The collection of $36,000 referred to in transaction A _____ result in an increase in revenue.
a. did
b. did not

3. What effect does transaction J have on cash?
a. increase
b. decrease
c. no effect

4. Did the investing activities in 2007 increase or decrease Alpha

Explanation / Answer

1.a 2.b 3.a 4.a this time i have double checked my answers

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