Question

1. The following information was provided by B&B  Inc. for its year ending December 31:

            

Total Assets	$20,000,000
Net income for the year	12,500,000
Shareholders' equity at year-end	10,500,000

How much does B&B, Inc. owe its creditors as of December 31,?

A.    $22,500,000

B.    $20,000,000

C.     $9,500,000

D.    $17,000,000

** I think the answer is C

2. Partial financial results are presented below for B&B Starbucks:

            

Operating profit	$435,000
Cash flow from:
Operations	115,000
Investing	125,600
Financing	(54,000)

What cash management actions most likely occurred during the year?

A.   B&B used cash from operations and from selling long-term assets to pay dividends.

B.   B&B used cash from bank loans or from selling stock and from operations to buy long-term assets.

C.   B&B used cash from bank loans or from selling stock to fund operations and to buy long-term assets.

D.  B&B used cash from operations to buy long-term assets and to repay debt.

E.   None of the Above

** Is D the answer

3. Which one of the following does create revenue?

A.    Sold shelving to customers on credit

B.    Sold plywood to customers for cash

C.    Sold bedding to customers

D.    Rented videos to a customer for cash

E.    All of the above

** Is the answer " All the Above"

4. B&B of California provided the following information concerning its accounting records:  

Collection revenue (all on account)	$925,000
Accounts receivable, January 1	250,000
Allowance for uncollectible accounts, January 1	2,700
Collections from customers during the year	810,000
Accounts written off as uncollectible during the year	25,000

How much is the balance of the Accounts Receivable account at December 31?

A.   $455,000

B.   $340,000

C.   $357,300

D.   $250,700

** not sure, please provide explanation. Thank you

Answer 1

Question 1:-

The correct answer for the question is Option C - $9,500,000. The Shareholders equity balance within a company's balance sheet includes the Net Income for the year. As such, since the total assets is $20,000,000, the value of the liabilities(owing to creditors) is calculated as:-

Creditors owed = Total assets - Shareholders equity

Creditors owed = $20,000,000 - $10,500,000

Creditors owed = $9,500,000

Option A, Option B and Option D are incorrect per the above calculations.

Kindly note that i have answered the first question per the Chegg answering guidelines. Request you to post the remaining question separately so that we can answer them as well. All the best and please let me know if you have any questions via the comments section .