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Arch Associates reports the following comparative balance sheets and income statement information.
| Arch Associates | |
| Comparative Balance Sheets | |
| | 12/31/Year 1 | | 12/31/Year 2 | |
| Cash | | $ | 16,000 | | | | $ | 26,000 | | |
| Accounts receivable | | | 8,000 | | | | | 12,000 | | |
| Prepaid insurance | | | 14,000 | | | | | 12,000 | | |
| Inventory | | | 10,000 | | | | | 6,000 | | |
| Property, plant and equipment | | | 16,000 | | | | | 14,000 | | |
| Total assets | | $ | 64,000 | | | | $ | 70,000 | | |
| Accounts payable | | $ | 12,000 | | | | $ | 16,000 | | |
| Salaries payable | | | 14,000 | | | | | 8,000 | | |
| Long term notes payable | | | 16,000 | | | | | 14,000 | | |
| Stockholders' equity | | | 22,000 | | | | | 32,000 | | |
| Total liabilities and equity | | $ | 64,000 | | | | $ | 70,000 | | |
| |
| Income Statement |
| Year Ended 12/31/Year 2 |
| Revenue | $ | 150,000 | |
| Cost of goods sold | | 60,000 | |
| Gross margin | | 90,000 | |
| Operating expense | | 40,000 | |
| Net income | $ | 50,000 | |
| |
The amount of cash collected from customers during Year 2 was:
Multiple Choice
$146,000.
$142,000.
$154,000.
$150,000.
Answer & Explanation
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