Bledsoe Company acquired $17,000 cash by issuing common stock on January 1, Year 1. During Year 1, Bledsoe earned $8,500 of revenue on account. The company collected $6,000 cash from customers in partial settlement of its accounts receivable and paid $5,400 cash for operating expenses. Based on this information alone, what was the impact on total assets during Year T? Multiple Choice 1. Total assets increased by $20,100 2. Total assets increased by $600. 3. Total assets increased by $26,100. 4. Total assets did not change

Question

Business

Martin Cherry

24 July, 17:20

Bledsoe Company acquired $17,000 cash by issuing common stock on January 1, Year 1. During Year 1, Bledsoe earned $8,500 of revenue on account. The company collected $6,000 cash from customers in partial settlement of its accounts receivable and paid $5,400 cash for operating expenses. Based on this information alone, what was the impact on total assets during Year T? Multiple Choice 1. Total assets increased by $20,100 2. Total assets increased by $600. 3. Total assets increased by $26,100. 4. Total assets did not change

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Roy Bradshaw · Answer 1

1. Total assets increased by $ 20,100

Explanation:

We need to determine the effect of each transaction on the total assets of Bledsoe Company.

Effect on Total Assets

Issuance of Common stock for Cash + $ 17,000

Revenues on account means increase in Receivables + $ 8,500

Collections of receivables + 0

Payments for Operating Expenses - $ 5,400

Net increase in Total assets + $ 20,100

The collection of receivables results in an increase in cash and a decrease in receivables, so no effect on total receivables