Question

The company's total assets are $40,000. The following is a listing of the company’s accounts and account balances as of December 31, Year 3. This company doesn't have any other accounts. Accounts Payable $ 8,000 Accounts Receivable 8,000 Supplies 2,000 Equipment 26,200 Common Stock 15,000 Cash Unknown Retained Earnings Unknown Required: Determine the balance of the Cash account.

Answer 1

Answer:

Determine the balance of the Cash account.

$3,800 Cash

Explanation:

As the total assets it's $40,000 by difference it's possible to find the total balance of cash account.

There are 3 accounts which belongs to the asset part, Accounts Receivable, Supplies and Equipment, by difference with the total balance of Assets it's possible to find the balance of Cash.

$40,000  TOTAL ASSETS  

Minus

-$8,000   Accounts Receivable

-$2,000   Supplies

-$26,200 Equipment

$3,800    Cash

December 31, Year 3  

$3,800 Cash

$8,000 Accounts Receivable

$2,000 Supplies

$13,800  TOTAL CURRENT ASSETS  

$26,200 Equipment

$26,200  TOTAL NONCURRENT ASSETS  

$40,000  TOTAL ASSETS  

$8,000  Accounts Payable  

$0,000  Income Tax Payable  

$8,000  TOTAL CURRENT LIABILITIES  

$8,000  TOTAL LIABILITIES  

$17,000  Retained Earnings  

$15,000  Common Stock  

$32,000  TOTAL EQUITY  

$40,000  TOTAL EQUITY + LIABILITIES