Ski West adjusts its accounts at the end of each month, but closes them only at the end of the calendar year (December 31). The ending balances in the Equipment Rental Revenue account and the Cash account in February and March appear below. Ski West prepares financial statements showing separately the operating results of each month. In the financial statements prepared for the month ended March 31, Equipment Rental Revenue and Cash should appear as follows:
A) Equipment Rental Revenue, $18,400; Cash, $26,500.
B) Equipment Rental Revenue, $18,400; Cash, $12,300.
C) Equipment Rental Revenue, $6,300; Cash, $26,500.
D) Equipment Rental Revenue, $6,300; Cash, $12,300.

Question

Quizplus · Accepted Answer

Equipment Rental Revenue for March is $6,300, which is the difference between February and March balances. Cash should be $26,500, the balance at the end of March.

Ski West Adjusts Its Accounts at the End of Each