The controller for Tires and More,Inc.has recorded the following transactions during the month: the purchase of equipment for $8,500 cash;payment of $6,300 for 3 months of rent;and,collection of $2,400 from a customer for services performed.At the beginning of the month the company was established by selling 10,000 shares of stock to the public for $15,000 cash.What is the balance in the Cash account at the end of the month,and is the balance a debit or a credit?
A)$2,600 debit.
B)$2,600 credit.
C)$6,800 debit.
D)$15,200 debit.

Question

Quizplus · Accepted Answer

The beginning balance in the Cash account is $15,000. The purchase of equipment for $8,500 reduces the balance to $6,500. The payment of $6,300 for rent further reduces the balance to $200. The collection of $2,400 from a customer increases the balance to $2,600. Therefore, the balance in the Cash account at the end of the month is $2,600 debit.

The Controller for Tires and More,Inc