ABC Corporation Began Operations on January 1^st of This Year

question 37

Multiple Choice

ABC Corporation began operations on January 1^st of this year with a cash balance of $250,000.ABC had sales of $200,000 for the month of January,all on credit.ABC allows its customers 30 days to pay.ABC's expenses for January equal $150,000,and ABC's ending balance in accounts payable at January 31^st is $50,000.In its cash budget for January,ABC's ending cash balance should be equal to

• A)$300,000 because of GAAP accrual accounting rules.
• B)$150,000.
• C)$200,000.
• D)$100,000.

---

Definitions:

Automatic Trade Execution

A feature of trading platforms that allows for the immediate execution of trades at the market price, based on pre-set criteria without manual intervention.

Stop-Loss Order

A type of order placed with a broker to sell a security when it reaches a certain price, used to limit an investor's loss on a position.

Limit Sell Order

An instruction to sell a security at a specified price or better, ensuring that the sell price is no lower than what the seller has defined.

Gains

The monetary increase in value of an asset or investment over its purchase price.