question archive During February 2014, its first month of operations, the owner of Schwenn Enterprises invested cash of $40,000
During February 2014, its first month of operations, the owner of Schwenn Enterprises invested cash of $40,000
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During February 2014, its first month of operations, the owner of Schwenn Enterprises invested cash of $40,000. Schwenn had cash sales of $8,000 and paid expenses of $14,000. Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28?
a. $6,000 credit
b. $34,000 debit
c. $48,000 debit
d. $26,000 credit
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The correct answer is option b. $34,000 debit
Explanation
Computation of cash balance
| Particulars | Amount |
|---|---|
| Cash invested (debit) | $40,000 |
| Add: Cash sales (debit) | $8,000 |
| Less: Cash expense paid (credit) | ($14,000) |
| Ending cash balance (debit) | $34,000 |
