Author Question: Poe, Inc. made 7,000 of cash sales to customers. The effect of this transaction on the accounting ... (Read 120 times)

V@ndy87 · **on:** Jul 5, 2018

Poe, Inc. made 7,000 of cash sales to customers. The effect of this transaction on the accounting equation is:

A) Total shareholders' equity
Total assets Total liabilities Contributed capital Retained earnings
Increase No effect Increse No effect

B) Total shareholders' equity
Total assets Total liabilities Contributed capital Retained earnings
Decrease No effect No effect Decrease

C) Total shareholders' equity
Total assets Total liabilities Contributed capital Retained earnings
No effect Decrease No effect Increase

D) Total shareholders' equity
Total assets Total liabilities Contributed capital Retained earnings
Increase No effect No effect Increase

Question 2

Bountiful Company had sales of 650,000 and cost of merchandise sold of 200,000 during the year. The total assets balance at the beginning of the year was 175,000 and at the end of the year was 167,000 . Calculate the ratio of sales to total assets.
a. 3.00
b. 3.80
c. 0.29
d. 0.26