Turner Company Started Its Business by Issuing $10,000 of Common

question 104

Essay

Turner Company started its business by issuing $10,000 of common stock on January 1,2016.The company performed $38,000 of service for customers on account in 2016.It collected $32,500 of this amount in 2016,recorded expenses on account of $29,500,paid $21,000 of the payables owed,and paid a $500 dividend to the stockholders.
Required:
a)What is the amount of total assets at the end of 2016?
b)What is the amount of cash on hand at the end of 2016?
c)What is the net income for 2016?
d)Prepare a balance sheet for 2016.

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Definitions:

Cartel

An agreement between competing firms to control prices or exclude entry of a new competitor in a market, usually to increase market power and profits.

Formal Agreement

refers to a legally binding contract between parties that outlines specific obligations and rights.

Covert Collusion

A secret agreement between firms to fix prices, limit production, or engage in other practices to restrict competition illegally.

Kinked Demand Curve Model

An economic model suggesting that price competition among firms may be rigid because a firm raising its price does not lead to competitors following suit, while price decreases are matched. This results in a demand curve with a kink.