Consider the following balance sheet: Cash $70,000 Accounts receivable $30,000 Inventories $50,000 Net fixed assets $350,000 Total assets $500,000 Accounts payable $30,000 Long-term debt $20,000 Common stock $200,000 Retained earnings $250,000 Total liabilities and equity $500,000 Assume that the business uses $30,000 of its cash to pay salaries. Which of the following statements reflects the resulting balance sheet change

Foundations of Business - Standalone book (MindTap Course List)
4th Edition
ISBN:9781285193946
Author:William M. Pride, Robert J. Hughes, Jack R. Kapoor
Publisher:William M. Pride, Robert J. Hughes, Jack R. Kapoor
Chapter15: Using Management And Accounting Information
Section: Chapter Questions
Problem 5DQ
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Consider the following balance sheet: Cash $70,000

Accounts receivable $30,000

Inventories $50,000

Net fixed assets $350,000

Total assets $500,000

Accounts payable $30,000

Long-term debt $20,000

Common stock $200,000

Retained earnings $250,000

Total liabilities and equity $500,000

Assume that the business uses $30,000 of its cash to pay salaries. Which of the following statements reflects the resulting balance sheet change?

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