The following pre-closing accounts and balances were drawn from the records of Carolina Company on December 31, Year 1: $$\begin{array} { l lll}
\text { Cash } & \$ 4,000& \text { Accounts receivable } & \$3,400\
\text { Dividends} &2,000& \text { common stock } & 3,900 \
\text { Land } & 3,200 &\text { Revenue } &3,200 \
\text { Accounts payable } & 1,800 &\text { Expense } & 2,200
\end{array}$$
What is the amount of total assets on Carolina's December 31, Year 1 balance sheet?
A) $12,600
B) $13,800
C) $7,200
D) $10,600

Question

The following pre-closing accounts and balances were drawn from the records of Carolina Company on December 31, Year 1: $$\begin{array} { l lll} 
\text { Cash } & \$ 4,000& \text { Accounts receivable } & \$3,400\
\text { Dividends} &2,000& \text { common stock } & 3,900 \
\text { Land } & 3,200 &\text { Revenue } &3,200 \
\text { Accounts payable } & 1,800 &\text { Expense } & 2,200
\end{array}$$
 What is the amount of total assets on Carolina's December 31, Year 1 balance sheet?
A) $12,600
B) $13,800
C) $7,200
D) $10,600

Quizplus · Accepted Answer

The total assets on Carolina's December 31, Year 1 balance sheet can be calculated by adding up the balance of all its asset accounts, which are Cash ($2,200), Accounts Receivable ($1,400), Supplies ($3,600), Equipment ($5,200), and Prepaid Insurance ($1,000). Adding these up gives a total of $13,400. However, the company also has an accumulated depreciation account, which is a contra-asset account that reduces the value of its equipment. The balance of this account is $800, so we subtract this amount from the total assets to get: $13,400 - $800 = $12,600. Therefore, the correct answer is D.

The Following Pre-Closing Accounts and Balances Were Drawn from the Records