A business commenced with capital in cash of C1,000. Inventory costing (800 net of sales tax at 17.5% is purchased on credit. Half of this inventory is then sold for ¢1,000 plus sales tax, the customer paying promptly in cash. The accounting equation after these transactions would show: O a. assets C2,775 less liabilities C975 equals capital C1,200 O b. assets C2,575 less liabilities (800 equals capital C1,775 O C. assets C1,775 less liabilities C175 equals capital C1,600 O d. assets C2,575 less liabilities C975 equals capital ¢1,600 The balance of petty cash book is O a. A liability O b. A gain O C. An asset O d. An expense

A business commenced with capital in cash of C1,000. Inventory costing (800 net of sales tax at 17.5% is purchased on credit. Half of this inventory is then sold for ¢1,000 plus sales tax, the customer paying promptly in cash. The accounting equation after these transactions would show: O a. assets C2,775 less liabilities C975 equals capital C1,200 O b. assets C2,575 less liabilities (800 equals capital C1,775 O C. assets C1,775 less liabilities C175 equals capital C1,600 O d. assets C2,575 less liabilities C975 equals capital ¢1,600 The balance of petty cash book is O a. A liability O b. A gain O C. An asset O d. An expense

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The comparative statements of Lily Company are presented here. Net sales Lily Company Income Statements For the Years Ended December 31 Cost of goods sold Gross profit Selling and administrative expenses Income from operations Other expenses and losses Interest expense Income before income taxes Income tax expense Net income Assets Current assets Cash Debt investments (short-term) Accounts receivable (net) Inventory Total current assets Plant assets (net) Total assets Lily Company Balance Sheets December 31 Liabilities and Stockholders' Equity Current liabilities Accounts payable Stockholders' equity Common stock ($5 par) Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 282,200 265,700 547,900 $971,800 $1,815,100 1,011,300 2022 803,800 517,400 286,400 2022 267,600 80,016 $ 187,584 $60,100 68,100 18,800 304,000 161,700 465,700 $852,700 116,200 123,100 367,500 604.300 $971,800 $160,300 2021 $64,600 50,200 102,900 114,500 332,200 520,500 $852,700…
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