Question

David's Financial Sevice (DFS) is a discount financial services firm offering clients investment advice, trading services and a variety of mutual funds for investment. David has collected the following information for October:

Advertising and marketing $91,000 Brokerage commissions (revenues) $2,998,000 Building rent and utilities $172,000 Fees from clients for investment advice $1,492,000 Labor cost for advice $796,000 Manager's salaries $298,000 Sales commissions to brokers $245,000 Training programs for brokers $423,000 Fees paid to execute trades $2,009,000

Required: Prepare an income statment for October for DFS.

Answer 1

Income Statement
Revenues:
Brokerage commissions	2,998,000
Fee from client	1,492,000
Total Revenue		4,490,000
Expenses:
Advertising and marketing	-91,000
Building rent and utilities	-172,000
Labor cost	-796,000
Manager salary	-298,000
Sales commission	-245,000
Training programs	-423,000
Fee paid to execute trades	-2,009,000
Total Expenses		-4,034,000
Net Income		$456,000

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