Tarr,a Sole Proprietorship,had the Following Balances and Transactions During 2017

question 199

Multiple Choice

Tarr,a sole proprietorship,had the following balances and transactions during 2017: beginning capital,$40,000;contribution of cash to the business by the owner,$15,000;revenue,$60,000;expenses,$35,000;withdrawal by the owner,$5,000.What is the amount of the ending capital balance?

• A)$40,000
• B)$60,000
• C)$75,000
• D)$85,000

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Definitions:

Depreciation

The process by which a fixed asset's value decreases over time due to use, wear and tear, or obsolescence.

Defaulted

refers to the failure to meet the legal obligations of a loan, such as not making the agreed-upon payments.

Deficiency

A shortfall or lack, especially of something essential or required.

Floating Lien

A security interest in proceeds, after-acquired property, or property purchased under a line of credit (or all three); a security interest in collateral that is retained even when the collateral changes in character, classification, or location.