Cambridge Cleaners Started Business on January 1, 2019, and Immediately

question 15

Short Answer

Cambridge Cleaners started business on January 1, 2019, and immediately purchased $5,000 of supplies to use in the business. At the end of the month, 30 percent of the supplies remains unpaid and 20% are still on hand. What amounts should appear as an expense on the financial statements for January? ?
Income Statement Statement of Cash Flows

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Definitions:

Capital Goods

Physical assets that a company uses in the production process to manufacture products and services that consumers will later use.

Specialization

The process of focusing resources on the production of specific goods or services to achieve greater efficiencies and economies of scale.

Economically Beneficial

Activities or decisions that result in a net gain in economic value, improving the economic welfare of individuals or society as a whole.

Larger Output

Refers to the increased production of goods or services by a company or economy.