The Total Assets and the Total Liabilities of Paragon Services

question 5

Multiple Choice

The total assets and the total liabilities of Paragon Services are shown below. During the year, no additional capital contributions were made, and the business earned net income of $50,000. What was the amount of drawings taken during the year?

• A)$85,000
• B)$40,000
• C)$45,000
• D)$20,000

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Definitions:

Epiglottis

A leaf-shaped flap of cartilage located behind the tongue, at the top of the larynx, which prevents food and drink from entering the windpipe.

Palatine Tonsils

Lymphatic tissue located on each side of the throat that helps defend the body against infection by trapping pathogens.

Soft Palate

The flexible, muscular part at the back of the roof of the mouth, which closes off the nasal passages during swallowing.

Hard Palate

Floor of the nasal cavity that separates the nasal cavity from the oral cavity; composed of the palatine processes of the maxillary bones and the horizontal plates of the palatine bones; also called bony palate.