Table 1-1
Following Is a Random List Showing the Account

question 11

Multiple Choice

Table 1-1
Following is a random list showing the account balances of various assets, liabilities, revenues, and expenses for Spiffy's Garage at December 31, 2019, the end of its first year of operations. $\begin{array} { | l | r | } \hline \text { Accounts receivable } & \$ 15,000 \\\hline \text { Accounts payable } & 3,500 \\\hline \text { Salary expense } & 4,500 \\\hline \text { Repairs expense } & 800 \\\hline \text { Truck } & 8,500 \\\hline \text { Equipment } & 6,300 \\\hline \text { Notes payable } & 8,200 \\\hline \text { Cash } & 6,800 \\\hline \text { Supplies expense } & 1,600 \\\hline \text { Service revenue } & 12,800 \\\hline \text { Gasoline expense } & 800 \\\hline \text { Salary payable } & 2,200 \\\hline\end{array}$ The owner, Spiffy Sloan, invested $22,600 at the beginning of the year and withdrew $5,000 during the year for personal use.
-Refer to Table 1-1. Owner's equity at December 31, 2019, was:

• A)$13,900.
• B)$22,700.
• C)$22,600.
• D)$18,700.

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Definitions:

Credit Account

is a financial arrangement where a borrower receives something of value now and agrees to repay the lender at a later date, often with interest.

Small Business Owner

A proprietor of a business enterprise that typically has a limited number of employees and a relatively low volume of sales.

Trade Credit

A financial arrangement where a buyer can purchase goods on account, paying the supplier at a later date, often used to improve cash flow.

New Businesses

Entities that have been recently established and are in the early stages of their operational and financial life cycle, facing unique challenges such as market entry and funding.