A retail business had cash of ($15,000) and inventory of ($70,000) on hand on January 1. On

Question:

A retail business had cash of $$15,000$ and inventory of $$70,000$ on hand on January 1. On January 7, it sold half of the inventory on credit for $$50,000$ and collected half of this amount on us January 26. The financial statements of the business would show

a. Profit of $$15,000$ and cash of $40,000

b. Profit of $$15,000$ and cash of $65,000

c. Profit of $$50,000$ and cash of $65,000

d. Loss of $$20,000$ and cash of $40,000

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