Reference no: EM131915207

Question - Ryan & Wang Ltd is a company that commenced business on 1 April 2015. Below are the balances of assets and liabilities accounts at 30 April 2015:

Supplies $560

Unearned revenue 300

Cash 70

Accounts payable 1,800

Inventory 3,500

Accounts receivable 2,400

Vehicles 12,000

Wages payable 960

During April Ryan & Wang Ltd made credit sales of $2,400 (cost of goods sold $1,000); received $300 from a customer for services that will be provided in May 2015; purchased inventory for $4,500, paid $2,700 and the rest will be paid in 30 days; purchased and paid $560 supplies; and expensed $960 in wages.

1. What is the balance of equity at 30 April 2015?

a. $15,770

b. $14,950

c. $19,070

d. $15,470

e. $21,590

2. Profit according to accrual accounting is:

a. $440

b. $1,440

c. $1,740

d. $(960)

e. $(2,760)

3. What is the net cash flow from operations for April 2015?

a. $0

b. $(2,960)

c. $(3,360)

d. $1,740

e. $300

Please explain the process of these three questions.