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3 February, 22:04

On June 30th, Carla's Cookies accounts include Cash $100,000, Accounts Receivable $50,000, Equipment $25,000 and Accounts Payable $75,000. During the month of July, the company used cash to purchase $8,000 of equipment and collected one-half of the accounts receivable. What is Carla's cash balance on July 31st?

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  1. 4 February, 01:54
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    Carla's cash balance on July 31st is $117,000.

    Explanation:

    On June 30

    Cash Balance = $100,000

    Accounts Receivable = $50,000

    Equipment = $25,000

    Account Payable = $75,000

    Purchase of equipment for cash = $8,000

    Collection from receivables = $50,000 x 0.5 = $25,000

    Cash Balance at July 31 = Cash Balance June 30 + Cash Inflows in July - Cash outflows in July

    Cash Balance at July 31 = $100,000 + $25,000 - $8,000 = $117,000
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