Greyson Construction has the following account balances at the end of the year: Cash \$12,000; Accounts Receivable \$8,000; Equipment \$25,000; Accounts Payable \$5,000; Common Stock \$30,000. What is the total of the debit balances that should appear on the trial balance?

• A. \$55,000
• B. \$45,000
• C. \$30,000
• D. \$50,000

Answer: (B)

Verified step by step guidance

1. Step 1: Understand the concept of a trial balance. A trial balance is a list of all accounts and their balances at a specific point in time, categorized into debit and credit balances. Debit balances typically include assets, expenses, and losses, while credit balances include liabilities, equity, revenues, and gains.
2. Step 2: Identify the accounts with debit balances from the given data. Debit balances are associated with asset accounts such as Cash, Accounts Receivable, and Equipment.
3. Step 3: Add the balances of the debit accounts together. Use the formula: Total Debit Balances = Cash + Accounts Receivable + Equipment. In MathML, this can be expressed as: $\mathrm{Total}=\mathrm{Cash}+\mathrm{Accounts} \mathrm{Receivable}+\mathrm{Equipment}$
4. Step 4: Verify that no liabilities or equity accounts (e.g., Accounts Payable and Common Stock) are included in the calculation, as these are credit balances and do not contribute to the total debit balances.
5. Step 5: Once the debit balances are summed, compare the total to the options provided in the problem to determine which matches the calculated total.