A business person starts a retail company by contributing $100,000 cash. 1 answer below »

A business person starts a retail company by contributing $100,000 cash. The company then buys inventory for $90,000, has sales of $150,000, cost of goods sold of $80,000, salaries of $30,000, rental of $12,000, advertising expenses of $8,000, and equipment purchases of $40,000. All of the transactions, except the purchase of equipment, are for cash. The financial statements of the company would show
a. Profit of $20,000, cash of $30,000, and equity of $100,000
b. Profit of $20,000, cash of $110,000, and equity of $120,000
c. Profit of $10,000, cash of $110,000, and equity of $120,000
d. Loss of $70,000, cash of $110,000, and equity of $30,000

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