Question

The following table provides Acme Corp's transaction for the month. Using the ACCRUAL CASH BASIS method and only the transactions listed, calculated the firm's NET INCOME for the month. Enter negative values using the minus sign (e.g. -122)

Transaction	Value
Issued shares of capital stock for cash	19693
Rented space at a self-storage for 2 weeks paid cash	-400
Purchased supplies to be used on a job during this month payment due next month	-800
Received a loan from a bank to be paid back in 1 year	15132
Received payment from customer for work completed and billed in previous month	2692
Paid miscellaneous expenses	-800
Received payment for customer for work completed and billed during this month	6210
Billed a customer for work completed to be paid in the next month	6102
Paid hourly employees for work completed during the month	-1200
Recorded depreciation of office building	-1000

Answer 1

• All working forms part of the answer
• Income Statement to calculate Net Income

Income Statement
Accrual Basis
Revenues:
Received payment for customer for work completed and billed during this month	$              6,210.00
Billed a customer for work completed to be paid in the next month	$              6,102.00
Total Revenues	$            12,312.00
Expenses:
Rented space at a self-storage for 2 weeks paid cash	$                  400.00
Purchased supplies to be used on a job during this month payment due next month	$                  800.00
Paid miscellaneous expenses	$                  800.00
Paid hourly employees for work completed during the month	$              1,200.00
Recorded depreciation of office building	$              1,000.00
Total Expenses	$              4,200.00
Net Income	$              8,112.00

• Working

Transaction	Financial Statement	Value
Issued shares of capital stock for cash	Balance Sheet, as Asset & Equity will be affected	$           19,693.00
Rented space at a self-storage for 2 weeks paid cash	Income Statement - Expense	$              (400.00)
Purchased supplies to be used on a job during this month payment due next month	Income Statement - Expense	$              (800.00)
Received a loan from a bank to be paid back in 1 year	Balance Sheet, as Asset & Liability will be affected	$           15,132.00
Received payment from customer for work completed and billed in previous month	Balance Sheet, as revenue already booked in previous month	$             2,692.00
Paid miscellaneous expenses	Income Statement - Expense	$              (800.00)
Received payment for customer for work completed and billed during this month	Income Statement - Revenue	$             6,210.00
Billed a customer for work completed to be paid in the next month	Income Statement - Revenue	$             6,102.00
Paid hourly employees for work completed during the month	Income Statement - Expense	$           (1,200.00)
Recorded depreciation of office building	Income Statement - Expense	$           (1,000.00)