A Business Has the Following Transactions

question 145

Multiple Choice

A business has the following transactions:
The business received $16,000 cash and issued common stock to stockholders.
The business purchases $700 of office supplies on account.
The business purchases $2,000 of furniture on account.
The business performs services to various clients totaling $13,000 on account.
The business pays out $3,000 for salaries expense and $3,500 for rent expense.
The business pays $700 to a supplier for the office supplies purchased earlier.
The business collects $1,000 from one of its clients for services rendered earlier in the month.
At the end of the month,all journal entries are posted to the ledger.Accounts Payable will appear as
Which of the following?

• A)Accounts Payable
• B)Accounts Payable
• C)Accounts Payable
• D)Accounts Payable

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Definitions:

Interest Accrued

The accumulation of interest on a loan or bond that has been earned but not yet paid.

Periodic Inventory Method

An inventory accounting method where physical counts are used to determine the cost of goods sold and ending inventory at specific intervals.

Petty Cash

A small amount of cash on hand used for covering minor expenses in an organization.

Periodic Inventory Method

An accounting method where inventory is updated and the cost of goods sold (COGS) is calculated at the end of an accounting period, instead of recording inventory transactions as they happen.