ABC Delivery Service had the following transactions in June: Earned $4 000 cash for services rendered; collected $2 500 from a customer 'on account;' paid out $200 cash for plumbing services; received $3 500 of supplies and promised to pay one month later; paid out $1 000 in cash drawings to the owner. What is the combined effect on Cash of the June transactions?

Question

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The combined effect on Cash of the June transactions is an increase of $5,300. This is because the company earned $4,000 in cash, collected $2,500 from a customer on account, and paid out $200 in cash for plumbing services. The company also received $3,500 of supplies and promised to pay one month later, which does not affect cash. The company also paid out $1,000 in cash drawings to the owner, which reduces cash.

ABC Delivery Service Had the Following Transactions in June: Earned