Question

During Year 1, Hardy Merchandising Company purchased $24,000 of inventory on account. Hardy sold inventory on account that cost $18,000 for $27,000. Cash payments on accounts payable were $15,000. There was $24,000 cash collected from accounts receivable. Hardy also paid $4,400 cash for operating expenses. Assume that Hardy started the accounting period with $20,000 in both cash and common stock. Required. Identify the events described in the preceding paragraph and show them in a horizontal statements model. The first event is recorded as an example.b. What is the balance of accounts receivable at the end of Year 1

Answer 1

Answer:

I have attached an Excel Sheet that identifies all the events that need to be accounted for. If you have any queries regarding the Journal Entries, please free to ask me that.

B) The Balance of Accounts Receivable at Year End is $3,000.

Explanation:

Hardy Merchandising Company made Sales of $27,000 on account, out of which $24,000 were collected during the year. So, at the year end the Balance Sheet will show a figure of $3,000 for Accounts Receivable.

Thank You!

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