X Company is a merchandiser and prepares monthly financial statements. The follo

Question

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 $52,258 Accounts Payable 31,586 Wages Payable 75,184 Notes Payable 5,672 Paid-In Capital 205,945 Retained Earnings $62,095 1,115 34,771 202,260 70,404 $370,645 $370,645 Total Equities The following summary transactions occurred during January: 1. Sold stock to investors for $45,000 2. Borrowed $25,000 from a bank. 3. Bought merchandise from suppliers, paying $3,217 and promising to pay $5,277 next month 4. Bought equipment from a manufacturer, paying $36,600 and promising to pay $4,600 in three months 5. Paid $3,600 to merchandise suppliers that it had promised to pay 6. Sold merchandise, receiving $16,624 cash and promises to pay of $4,566; the merchandise that was sold previously cost $10,595 7. Paid a total of $508 for rent and insurance in advance 8. Received $2,567 from customers who had promised to pay 9. Paid $5,490 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 Answer Tries 0/3 6. What was net income in January? Submit Answer Tries 0/3

Explanation / Answer

4)cash balance on january 31 is $92034 5)total Equities on january 31 is $317664 6) net income for january 31 is $5105 Cash balance Equity balance Net Income Opening balances $                          52,258.00 $                                                    2,72,664.00 1.Sale of common stock for $45000 $                          45,000.00 $                                                        45,000.00 2 Borrwed from bank $25000 $                          25,000.00 3 Purchasing Merchandise $3217 $                          -3,217.00 4 part payment for Purchase of Equipment $36600 $                        -36,600.00 5 Payment of merchanise (pending) $3600 $                          -3,600.00 6 Sale of Merchasie for cash $16624 $                          16,624.00 $   16,624.00 Sale of merchandise for credit$4566 $     4,566.00 Cost of sale of Merchandise $10595 $ -10,595.00 7 Payemtn of rent & insurance in advance $508 $                              -508.00 8 Receipts from credit sales $2567 $                            2,567.00 9 Payment for wages, utilities, and other Misc expenses $                          -5,490.00 $   -5,490.00 Net income $                                                          5,105.00 Closing balances on jan 31 $                          92,034.00 $                                                    3,17,664.00 $     5,105.00

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