Q12

12. Company A has the following information excerpted from its financial statements: (Omitted) Accounts Receivable Inventory Total Assets Accounts Payable Total Liabilities Total Owners' Equity Dec. 31, Year 1 1,400 11,200 57,400 9,240 21,000 36,400 Dec. 31, Year 2 1,680 15,400 56,000 10,360 19,600 36,400 Year 1 92,300 65,000 27,300 22,400 Year 2 93,600 66,300 27,300 23,380 Year 3 101,400 68,900 32,500 23,240 Revenue COGS Gross Profit Other Expenses (including) - Advertising - Payroll Net Income 10,000 3,000 3,430 11,000 3,200 2,744 9,000 3,300 6,482 Year 2 6,216 (2,327) Year 3 8,200 (2,465) 1,300 Cash flow from operating activities Purchase of PP&E Proceeds from sale of PP&E (other items omitted) Cash flow from investing activities Proceeds from loan Repayment of loan Repurchase of stock Dividends paid (other items omitted) Cash flow from financing activities Change in cash (2,216) 2,600 (3,360) 0 (2,400) 800 3,000 (9,400) (4,000) (2,600) (3,000) 1,000 (4,500) 4,500 Suppose the company has only two liability accounts as of Dec. 31, Year 2: Accounts Payable and Loan Payable. Which of the following statements is correct? O The balance in Loan Payable as of Dec. 31 Year 1 is $2,840. The balance in Loan Payable as of Dec. 31 Year 1 is $9,240. The balance in Loan Payable as of Dec. 31 Year 3 is $10,000. O The balance in Loan Payable as of Dec. 31 Year 2 is $9,240