During February 2022, Its First Month of Operations, the Owner

question 177

Multiple Choice

During February 2022, its first month of operations, the owner of Schwenn Enterprises invested cash of $100,000.Schwenn had cash sales of $20,000 and paid expenses of $35,000.Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28, 2022?

• A)$15,000 credit
• B)$85,000 debit
• C)$120,000 debit
• D)$65,000 credit

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Definitions:

Recession

An episode of provisional economic downturn, during which industrial and commercial activities decrease, customarily identified by a GDP drop in two consecutive quarters.

Money Supply

The sum of all financial resources present in an economy at a given moment, encompassing currency, deposits in banks, and other assets that can be quickly converted into cash.

Federal Reserve

The principal banking authority in the United States, responsible for overseeing the nation's financial and monetary systems.

Reserve Requirement

The reserve requirement is a central banking regulation that sets the minimum amount of reserves that must be held by a commercial bank, not to be loaned out, to ensure bank liquidity and stability.