Homework Answers
Effects on total assets:
1.The receipt of cash from the stock sale would increase the assets
(cash) through $17,000.
2.Cash receipt from Accounts receivable does not change the total assets. So, it will create no effect.
3.Revenue on account result in increase in assets (Accounts receivable) through $8,500.
4.Cash paid result in decrease in total assets (cash) through $5,400.
From the above effects on assets, the value of net assets would be:
Net assets = $17,000 + $8,500 - $5,400
= $20,100
Therefore, the correct option is B, that is total assets increased by the amount of $20,100.
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