A Sole Proprietorship Reported the Following Transactions for the Month $\$ 8,000$

question 123

Multiple Choice

A sole proprietorship reported the following transactions for the month of March.The transactions have been journalized and posted to the proper accounts. Mar. I The business received $\$ 8,000$ cash from the owner in excharge for capital.
Mar. 2 Paid the first month's rent of $\$ 600$ .
Mar. 3 Purchased equipment by paying $\$ 1,000$ cash and executing a note payable for $\$ 3,000$ .
Mar. 4 Purchased office supplies for $\$ 600$ cash.
Mar. 5 Billed a client for $\$ 11,000$ of desipr services completed.
Mar. 6 Received $\$ 9,000$ on account for the services previously recorded. What is the balance in Accounts Receivable?

• A) $9,000
• B) $2,000
• C) $3,000
• D) $11,000

---

Definitions:

Factory Overhead

All indirect costs involved in the production process, such as utilities and maintenance, not directly tied to production output.

Debit Balance

A financial condition where the total debits in an account exceed the total credits, often indicating amounts owed.

Credit Balance

The amount residing in a financial account that indicates credit or the sum payable to a party, opposite of a debit balance.

Underapplied

Refers to the situation where the allocated manufacturing overhead cost is less than the actual manufacturing overhead cost incurred.