1. During 2020, company QWE had the following transactions: Shareholders contribute 10,000 Purchased inventory on credit for 45,000 Sales of 86,000 (COGS 32,000), half of them credit and half of them cash Purchased a new van for 12,000. Residual value 2,000 and 4 year useful life Paid a dividend to shareholders for 5,000 A bad debt of 2,150 is written off Paid 2,000 in utility bills during the year. The last bill for 1,000 is still outstanding. Taxes amount to 20% of profits and will be paid in 2021 The total of liabilities and equity at the end of 2020 is:

Select one:

a. 97,350

b. 104,500

c. 99,500

d. 102,350

2. Company XYZ pays electricity quarterly, but the bill arrives with one month delay (i.e. the electricity bill for Q1, including January, February and March, is paid at the end of April). During the year the company paid 400 for Q1, 400 for Q2 and 500 for Q3. The company expects electricity expenses to be constant going forward. The effect on the financial statement is:

Select one:

a. A cost of 1800 for the income statement and an accrual of 500 in the balance sheet

b. A cost of 1300 for the income statement and an accrual of 500 in the balance sheet

c. A cost of 1300 for the income statement and an accrual of 400 in the balance sheet

d. It depends on the opening accrual in the balance sheet