In the First Month of Operations, the Total of the Debit

question 68

Multiple Choice

In the first month of operations, the total of the debit entries to the Cash account amounted to $1,200 and the total of the credit entries to the Cash account amounted to $800.The Cash account has a(n)

• A)$800 credit balance.
• B)$1,200 debit balance.
• C)$400 debit balance.
• D)$400 credit balance.

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Definitions:

Cost of Goods Sold

The direct expenses tied to the production of goods sold by a company, including material and labor costs.

Net Income

A company's profit amount after all deductions for expenses and taxes from revenue have taken place.

FIFO Cost Flow

An inventory valuation method (First In, First Out) where goods first purchased or produced are sold or used first.

Income Tax Expense

The amount of money a company is obligated to pay in income taxes for a given fiscal period.