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During the month, Bavarian Auto Co. received $379,550 in cash and paid out $320,350 in cash. a. Does this information indicate that Bavarian Auto Co. had net income of $59,200 during the month? No
Net income is ✓ the net change in all assets and liabilities from operating (revenue and expense) transactions.

b. If the balance of the cash account is $85,800 at the end of the month, what was the cash balance at the beginning of the month?​

Respuesta :

Answer:

No, $59,200 shows only the change in the net cash not in the net income.

The beginning cash balance for the month is $26,600.

Explanation:

a. When the difference of the cash received that is $379,550 and cash paid that is $320,350 is taken it shows only the net change in the cash balance that is $59,200, irrespective of the net income, as this might or might not include some of the revenues or expenses which are in the cash form.

b. When the ending cash balance is $85,800, and the net cash changes is $59,200; then the beginning cash balance will the difference of the ending cash balance and the net cash changes; this will amount to $26,600.

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