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 $62,095 1,115 34,771 202,260 70,404 $370,645 $52,258 Accounts Payable 31,586 Wages Payable 75,184 Notes Payable 5,672 Paid-In Capital 205,945 Retained Earnings $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? $92,034 You are correct. Your receipt no. is 152-9569 ) 5. What were total equities on January 31? 317664

Explanation / Answer

Cash balance 92034 Total equity 322769 X Company Trial Balance as at January 31 Opening Transactions Adjusted Income statement Balance sheet Account Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit Cash 52258 89191 49415 92034 92034 Accounts Receivable 31586 4566 2567 33585 33585 Inventory 75184 8494 10595 73083 73083 Prepaid rent 5672 508 6180 6180 Equipment 205945 41200 247145 247145 Accounts payable 62095 3600 9877 68372 68372 Wages payable 1115 1115 1115 Notes payable 34771 25000 59771 59771 Paid in capital 202260 45000 247260 247260 Retained earnings 70404 70404 75509 Sales revenue 21190 21190 21190 Cost of goods sold 10595 10595 10595 Wages expense 5490 5490 5490 370645 370645 163644 163644 468112 468112 16085 21190 452027 452027 Net Income 5105 T o t a l 370645 370645 163644 163644 468112 468112 21190 21190 452027 452027

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