Question

Following are transactions of Gotebo Tanners, Inc., a new company, during the month of January 2012:

1. Issued 10,000 shares of common stock for $15,000 cash.
2. Purchased land for $12,000, signing a note payable for the full amount.
3. Purchased office equipment for $1,200 cash.
4. Received cash of $14,000 for services provided to customers during the month.
5. Purchased $300 of office supplies on account.
6. Paid employees $10,000 for their first month's salaries.

What was the balance of Gotebo's Cash account following these six transactions?

$29,800.

$19,300.

$17,800.

$22,400.

Answer 1

Answer:$17,800

Explanation: You are to add all the receipts and less all payments from total receipts.

Note: The purchase of land for $12,000 will not be included as the it is written on note payable, and also the $300 of office supplies will also not be included in payments as it was made from account.