The Diamond Store Began Business on June 1

question 67

Multiple Choice

The Diamond Store began business on June 1. During the month of June, it had cash payments of $9,000.At the end of June, it had a $14,000 balance in cash. Based on this information, the cash receipts for the month of June:

• A) were $5,000.
• B) were $16,000.
• C) were $23,000.
• D) cannot be determined.

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Definitions:

Investments-Evans Company Bonds

Refers specifically to financial investments made in bonds issued by the Evans Company, representing a loan by the investor to the issuer.

Temporary Investments

Investments that a company plans to sell within a short period, typically within one year.

Current Assets

Assets likely to be converted into cash, sold, or consumed within one year or a business cycle, such as cash, inventory, and receivables.

Cash Equivalents

Investments of a short duration that are highly liquid, easily converted into precise cash amounts, and carry a minimal risk of fluctuating in value.