Table 7-8 Nordin Avionics
J Cash Receipts Journal -Refer to Table 7-8 at the End of January, What

question 52

Multiple Choice

Table 7-8 Nordin Avionics
J. Nordin Avionics began business on January 1, 2019. The business was started with $10,000 in the cash account and $30,000 of inventory in stock. Nordin uses a sales journal to record credit sales and a cash receipts journal to record all cash receipts, including both cash sales and cash collections of credit sales. At the end of January, the two journals appeared as follows:
Sales Journal $\begin{array}{|l|l|l|l|l|r|}\hline& & & &\text { Accts Rec } & \\\text { Date } & \text { Invoice \# } & \text { Customer } & \text { Post } & \text { DR } & \text { COGS DR/ } \\&&&\text { Ref. } & \text { Sales Rev CR } & \text { Inventory CR }\\\hline \text { Jan } 4 & 1000 & \text { Reed, A. } & & \$ 5,000 & \$ 4,100 \\\hline 6 & 1001 & \text { Charles, B. } & & 1,240 & 990 \\\hline 13 & 1002 & \text { Reed, A. } & & 3,200 & 2,800 \\\hline 20 & 1003 & \text { Williams, D. } & & 900 & 820 \\\hline 22 & 1004 & \text { Charles, B. } & & 5,100 & 4,600 \\\hline & & \text { Total } & & \$ 15,440 & \$ 13,310 \\\hline\end{array}$ Cash Receipts Journal $$\begin{array} { | r | r | r | r | r | r | r | } \hline \text { Date } & { \begin{array} { c } \text { Cash } \\\text { Debit }\end{array} } & \begin{array} { c } \text { Sales Revenue } \\\text { Credit }\end{array} & \begin{array} { c } \text { Accts. } \\\text { Rec. } \\\text { Credit }\end{array} & \text { Invoice \# } & \text { Customer } & \begin{array} { r } \text { COGS DR/ } \\\text { Inventory CR }\end{array} \\\hline \text { Jan 5 } & \$ 3,300 & \$ 3,300 & & & & \$ 2,700 \\\hline 10 & 5,000 & & \$ 5,000 & 1000 & \text { Reed, A. } & \\\hline 14 & 9,000 & 9,000 & & & & 8,000 \\\hline 18 & 1,240 & &1,240 & 1001& \text { Charles,B. } & \\\hline & \$ 18,540 & \$ 12,300 & \$ 6,240 & & & \$ 10,700 \\\hline\end{array}$$
-Refer to Table 7-8 at the end of January, what was the balance in Inventory? Assume no new inventory was acquired during January.

• A)$5,990 debit balance
• B)$6,340 debit balance
• C)$24,010 credit balance
• D)$5,100 debit balance

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Definitions:

Fiscal Year-End

The end of a company's financial year, a critical date for accounting and financial reporting purposes.

Corporation

A legal entity that is separate and distinct from its owners, which can own assets, incur liabilities, and is taxed on its profits.

Dividends Received Deduction

A tax deduction that a corporation can claim for dividends received from other corporations within the same tax group.

Taxable Income

The portion of an individual's or entity's income used to determine how much tax is owed to the government in a given tax year.