Question

= View Policies Current Attempt in Progress In the first month of operations for Swifty Industries, the total of the debit entries to the cash account amounted to $35300 ($16700 investment by the owner and revenues of $18600). The total of the credit entries to the cash account amounted to $21800 (purchase of equipment $8500 and payment of expenses $13300). At the end of the month, the cash account has aln) O $5100 credit balance. O $13500 debit balance. O $5100 debit balance. O $13500 credit balance.

Answer 1

SOLUTION:-

Computation of balance of Cash account of Swifty Industries at the end of the month.

Operations involving cash transactions are as follows:-

1. Investment by the owner of $16700.
2. Revenues of $18600.
3. Purchase of equipment $8500.
4. Payment of expenses $13300.

Total Receipts of cash will be investment from owner and revenues that is $16700 and $18600 respectively.

Total Payments involving cash will be purchase of equipments and payment of expenses that is $8500 and $13300 respectively.

Therefore total cash received will be $35300 ($16700+18600) against payment of $21800 ($8500+$13300).

So net balance after considering all the transactions will total cash receipts less total cash payments.

$35300 - $8500 = $13500

As cash receipts are more than cash payments it will be debit balance in cash account at the end of the month amounting to $13500.

Alternatively, we can also make Cash Account.

Particulars	Debit $	Particulars	Credit $
Investment by the owner Revenues	16700 18600	Purchase of Equipment Expenses Excess of Debit over Credit Balance	8500 13300 13500
Total	35300	Total	35300

Conclusion:- At the end of the month Swifty Industries Cash Account has Debit balance of $13500.