Sanchez Company Engaged in the Following Transactions During Year 1

question 91

Multiple Choice

Sanchez Company engaged in the following transactions during Year 1:
1) Started the business by issuing $42,000 of common stock for cash.
2) The company paid cash to purchase $26,400 of inventory.
3) The company sold inventory that cost $16,000 for $30,600 cash.
"4) Operating expenses incurred and paid during the year, $14,000.
Sanchez Company engaged in the following transactions during Year 2:"
1) The company paid cash to purchase $35,200 of inventory.
2) The company sold inventory that cost $32,800 for $57,000 cash.
"3) Operating expenses incurred and paid during the year, $18,000.
Note: Sanchez uses the perpetual inventory system.
The balance in the inventory account shown at December 31, Year 2 is:"

• A) $2,400.
• B) $12,800.
• C) $61,600.
• D) $28,800.

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Definitions:

Separate Sheets

Distinct documents or drawings individually detailing parts of a larger project or scheme.

Specified Texture

A defined surface quality or feel of a material, often detailed in engineering and design specifications to ensure consistency.

Mating Part

A component designed to connect with or fit into another component, ensuring a correct assembly or functional interaction between parts.

Material Removal

Material removal refers to the process of eliminating material from a workpiece through machining operations, such as cutting, drilling, or milling to achieve desired dimensions and features.