Gulf Waterworks Company Provides Plumbing Services

question 105

Multiple Choice

Gulf Waterworks Company provides plumbing services.The company is a sole proprietorship.Transactions during the first year of operations are given below.
a) The owner,Jason Robinson,contributed $6,000 cash in exchange for capital.
b) Paid $5,000 cash for equipment to be used for plumbing repairs.
c) Borrowed $26,000 from a local bank and deposited the money in the checking account.
d) Paid $600 rent for the year.
e) Purchased $1,800 of office supplies on account.
f) Completed a plumbing repair project for a local lawyer and received $3,200 cash.
Calculate the amount of total owner's equity at the end of the first year after recording the transactions.Assume office supplies of $1,800 are left at the end of the year.

• A) $8,600
• B) $3,200
• C) $6,000
• D) $26,000

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