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

ID: 2598730 • Letter: X

Question

X Company is a merchandiser and prepares monthly financial statements. The following is its balance sheet at the beginning of January:

The following summary transactions occurred during January:

Sold stock to investors for $45,000.

Borrowed $26,000 from a bank.

Bought merchandise from suppliers, paying $3,280 and promising to pay $5,161 next month.

Bought equipment from a manufacturer, paying $31,800 and promising to pay $4,100 in three months.

Paid $3,315 to merchandise suppliers that it had promised to pay.

Sold merchandise, receiving $17,445 cash and promises to pay of $4,935; the merchandise that was sold previously cost $11,190.

Paid a total of $543 for rent and insurance in advance.

Received $3,570 from customers who had promised to pay.

Paid $5,670 for wages, utilties, and other miscellaneous expenses.

Note: Ignore adjusting entries.
4. What was the cash balance on January 31? $100,076

5. What were total equities on January 31?

6. What was net income in January?

Balance Sheet January 1

Cash balance 100076

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