Question

Radar Repair Company opened on March 1 of the current year. During March, the following transactions occurred and were recorded in the company's books: 1. Rick Radar, the sole stockholder, invested $20,000 cash in the business in exchange for common stock. 2. Rick contributed $2,000 of equipment to the business in exchange for common stock. 3. The company provided $8,000 of services to customers on account. 4. The company paid $2,000 cash to rent office space for the month of March and April ($1,000 per month). 5. The company collected $11,000 cash for repair services, $5,000 representing payment for services provided during March* and $6,000 representing payment for services to be provided in April. *these are additional March services & are unrelated to transaction #3. 6. The company paid $4,000 for salaries for the month of March. 7. The company purchased $2,000 of supplies. Radar paid $1,000 of cash at the time the supplies were delivered and purchased the remaining supplies on account. 8. The company collected $5,000 from customers as payment on account for services rendered on account in March (transaction #3). Based on this information, total stockholder's equity reported on the balance sheet at the end of March would be: A $30,000 B. $25,000 none of the answer choices provided are correct. $31,000 E. $22,000

Answer 1

Calculate total stockholder's equity

Invested in common stock 20,000$

Contributed in common stock 2,000$

Net income 3,000$

Total stockholder's equity 25,000$

So answer is B)25,000$