Thermo HVAC Is a Heating and Air Conditioning Service Business

question 4

Essay

Thermo HVAC is a heating and air conditioning service business.On December 31,2010,after its first month of business,Thermo HVAC had the following balances in its accounts,listed alphabetically.
$\begin{array}{|l|r|}\hline\text { Accounts receivable } & 4,100 \\\hline \text { Accounts payable } & 22,000 \\\hline \text { Advertising expense } & 1,600 \\\hline \text { Building } & 17,000 \\\hline \text { Cash } & ? ? ? \\\hline \text { Capital } & 45,000 \\\hline \text { Withdrawals } & 1,800 \\\hline \text { Equipment } & 1,800 \\\hline \text { Land } & 67,000 \\\hline \text { Note payable } & 58,000 \\\hline \text { Salary expense } & 1,800 \\\hline \text { Service revenue } & 62,000 \\\hline \text { Supplies } & 2,900 \\\hline \text { Utilities expense } & 4,200\\\hline\end{array}$ Determine the balance in the cash account and prepare a trial balance using proper format.
$$\begin{array} { | l | l | l | } \hline \text { Account Title } & \text { Debit } & \text { Credit } \\\hline & & \\\hline & & \\\hline & & \\\hline & & \\\hline & & \\\hline & & \\\hline & & \\\hline & & \\\hline & & \\\hline\end{array}$$

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Definitions:

Coase Theorem

A principle that suggests that if property rights are clearly defined and transaction costs are low, externalities can be efficiently resolved through private bargaining, regardless of who holds the rights.

Basic Rights

Fundamental entitlements and freedoms that are guaranteed to individuals, often protected by law or international treaties.

Impediments To Bargaining

Factors or conditions that obstruct or complicate the process of reaching a negotiation agreement.

Marginal Cost

The amount spent to produce a further unit of a good or service.