The following transactions occurred during March, the first month of operations for Canyon Products, Inc.:

1. Issued 50,000 shares of capital stock in exchange for $600,000 cash.
2. Purchased land for $400,000, using a $150,000 cash down payment and signing a note payable for the balance.
3. Made a $60,000 cash payment on the note payable from the purchase of land.
4. Purchased equipment on credit from Burton, Inc. for $63,000.

What is the balance in the Cash account at the end of March?
A)$810,000
B)$210,000
C)$600,000
D)$390,000

Question

The following transactions occurred during March, the first month of operations for Canyon Products, Inc.:

1. Issued 50,000 shares of capital stock in exchange for $600,000 cash.
2. Purchased land for $400,000, using a $150,000 cash down payment and signing a note payable for the balance.
3. Made a $60,000 cash payment on the note payable from the purchase of land.
4. Purchased equipment on credit from Burton, Inc. for $63,000.

What is the balance in the Cash account at the end of March?
A)$810,000
B)$210,000
C)$600,000
D)$390,000

Quizplus · Accepted Answer

The purchase of equipment on credit does not affect the Cash account. Therefore, we need additional information to determine the balance in the Cash account at the end of March. None of the other answer choices provide any information relevant to determining the balance in the Cash account.

The Following Transactions Occurred During March, the First Month of Operations