A company was formed with $60,000 cash contributed by its owners in exchange for common stock.The company borrowed $30,000 from a bank.The company purchased $10,000 of inventory and paid cash for it.The company also purchased $70,000 of equipment by paying $10,000 in cash and issuing a note for the remainder.
-Use the information above to answer the following question.What is the amount of the total assets to be reported on the balance sheet?
A) $150,000.
B) $160,000.
C) $90,000.
D) $80,000.

Question

Quizplus · Accepted Answer

The total assets are calculated as follows: Cash ($60,000 initial + $30,000 loan - $10,000 inventory - $10,000 equipment) = $70,000, Inventory = $10,000, Equipment = $70,000. Total assets = $70,000 + $10,000 + $70,000 = $150,000.

A Company Was Formed with $60,000 Cash Contributed by Its