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During a recent week, Cairns Consulting received $15,000 cash from clients for services performed with a total value of $50,000.The balance is to be received within 30 days.
-The effect on the balance sheet equation for this transaction would be:
A)+ $15,000 cash = - $35,000 accounts payable + $50,000 retained earnings
B)+ $15,000 cash - $35,000 accounts receivable = $50,000 retained earnings
C)+ $15,000 cash + $35,000 accounts receivable = + $50,000 retained earnings
D)+ $15,000 cash = + $15,000 retained earnings

Question

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During a recent week, Cairns Consulting received $15,000 cash from clients for services performed with a total value of $50,000.The balance is to be received within 30 days.
-The effect on the balance sheet equation for this transaction would be:
A)+ $15,000 cash = - $35,000 accounts payable + $50,000 retained earnings
B)+ $15,000 cash - $35,000 accounts receivable = $50,000 retained earnings
C)+ $15,000 cash + $35,000 accounts receivable = + $50,000 retained earnings
D)+ $15,000 cash = + $15,000 retained earnings

Quizplus · Accepted Answer

The company received $15,000 in cash and has $35,000 in accounts receivable, totaling $50,000 in revenue, which increases retained earnings.

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