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followng trankactions during 2005. 1. The company was started with $15,000 of common stock issued to investors for capsh. 2. The company purchased equipment on July 1 that cost $8,500 cash. The equipment had a four-year useful lifo and a $500 estimated salvago value. 3. There were $300 of supplies purchased on account. 4. Sales on account amounted to $6,000. 5. Cash collections of receivables amounted to $4,500. 6. On October 1,2005 the company paid \$2,400 in advance for a 12-month insurance policy that became effective on October 1 . 7. Supplies on hand as of December 31,2005 amounted to $100. 29. The amount of depreciation expense appearing on the December 31, 2005 incorne statement wo (A) $2,000. B) $1,000. C) $1,025. D) $2,125. 30. The adjusting entry necessary to record the supplies expense would result in a: A) $300 increase in assets and liabilities. C) $200 decrease in assets and equity B) $300 decrease in assets and equity. D) $200 increase in assets and liabili 31. The amount of insurance expense reported on the income statement for 2005 would be: A) $600. B) $2,400. C) $200. D) None of the above. 32. The amount of cash flow from operations would be: A) $8,600. B) 53,400 . C) $2,100. D) $6,600. 33. The amount of total liabilities appearing on the December 31,2005 balance sheet would A) $2,400. B) $1,500. C) $200. D) $300. 34. The amount of common stock as of December 31,2005 was: A) $8,500. B) $15,000. C) $4,200. D) None of the above

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