Question

Marco Nelson opened a frame shop and completed these transactions: Marco started the shop by investing $40,700 cash and equipment valued at $18,700 in exchange for common stock. Purchased $140 of office supplies on credit. Paid $1,900 cash for the receptionist's salary. Sold a custom frame service and collected $5,200 cash on the sale. Completed framing services and billed the client $270. What was the balance of the cash account after these transactions were posted?

Answer 1

Answer:

$44,000

Explanation:

Given that,

Marco started the shop by investing = $40,700 cash  

Equipment valued = $18,700 in exchange for common stock.

Purchased office supplies on credit = $140

Paid cash for the receptionist's salary = $1,900

Balance of the cash account after these transactions were posted:

= Cash Investing in Shop - Paid cash for receptionist salary + Receive cash from sale of frame

= $40,700 - $1,900 + $5,200

= $44,000