Question

Mine Company had the following transactions during 2019: Sales of $4,800 on account. Collected $2,000 for...

Mine Company had the following transactions during 2019:

  • Sales of $4,800 on account.
  • Collected $2,000 for services to be performed in 2020.
  • Paid $1,625 cash in salaries for wages earned in 2019.
  • Purchased airline tickets for $250 in December for a trip to take place in 2020.

            What is Mine Company 2019 net income using accrual accounting?

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Answer: $3,175

Explanation:

Income Statement under Accrual accounting
Particulars Amount ($)
Sales revenue $4,800
Total Revenue $4,800
Salaries $1,625
Total Expenses $1,625
Net Income $3,175

Notes:

1) $2,000 receved in advance for services to be performed in 2020 will not be accounted as revenue because service is not yet performed.

2) Purchase of airlines tickets for $250 in december will not be recognised as expense because expense will be incurred only in 2020 when trip is made eventhough payment is done in 2019.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
La More Company had the following transactions during 2016: Sales of $9,000 on account Collected $4,000...
La More Company had the following transactions during 2016: Sales of $9,000 on account Collected $4,000 for services to be performed in 2017 Paid $3,750 cash in salaries for 2016 Purchased airline tickets for $500 in December for a trip to take place in 2017 What is La More’s 2016 net income using accrual accounting? ​ ​$9,250 ​$9,750 ​$5,250 ​$5,750
During 2019, Ocean Consulting had the following transactions with it clients (customers): On February 1, 2019,...
During 2019, Ocean Consulting had the following transactions with it clients (customers): On February 1, 2019, the company received cash of $10,000 from clients in payment of their account balances as of December 31, 2018. On November 1, 2019, the company received $4,000 cash as payments in advance for services to be performed in 2020. The company received a total of $26,000 in cash for services that were performed during 2019. The company sent bills totaling $8,000 to clients for...
1. Yellow Mango Company had the following transactions during 2016: • Sales of Php 4,500 on...
1. Yellow Mango Company had the following transactions during 2016: • Sales of Php 4,500 on account • Collected Php 2,000 for services to be performed in 2017 • Paid Php 1,625 cash in salaries • Paid Php 5,000 for insurance effective 2017. What is Yellow Mango’s 2016 net income/net loss using accrual accounting? 2. On January 1, 2016, Ms. Scarlet set up a sole proprietorship. She contributed cash of Php 1,500,000 and secured a loan of Php 220,000 ....
The Abigail Company had the following adjustments at December 31, 2019, the end of the accounting...
The Abigail Company had the following adjustments at December 31, 2019, the end of the accounting period: The company signed a $15,000, 6%, one-year note payable on September 1st. Record the accrual on 12/31. On November 1, 2019, the Abigail Company paid $3,000 for six months of rent in advance. The rental period is November 1, 2019 through April 30, 2020. Prepare the adjustment on 12/31.    On August 1, 2019, the company collected $24,000 in advance for a consulting contract,...
Rachel Kumar, DDS, had the following balances in selected accounts on December 31, 2019. Accounts Receivable...
Rachel Kumar, DDS, had the following balances in selected accounts on December 31, 2019. Accounts Receivable $ 0 Prepaid Insurance 2,220 Supplies 2,940 Equipment 6,650 Accumulated Depreciation – Equipment 0 Salaries and Wages Payable 0 Notes Payable 15,000 Interest Payable 0 Unearned Service Revenue 30,000 All of the accounts have normal balances. The information below has been gathered at December 31, 2019. 1.Depreciation on the equipment for 2019 is $1,300. Record the adjusting entry. 2. Rachel Kumar borrowed $15,000 by...
The net income of Steinbach & Sons, a landscaping company, decreased sharply during 2019. Mort Steinbach,...
The net income of Steinbach & Sons, a landscaping company, decreased sharply during 2019. Mort Steinbach, owner and manager of the company, anticipates the need for a bank loan in 2020. Late in 2019, Steinbach instructs the company’s accountant to record $2,000 service revenue for landscape services for the Steinbach family, even though the services will not be performed until January 2020. Steinbach also tells the accountant not to make the following December 31, 2019, adjusting entries: Salaries owed to...
Dak Company began operations on August 1, 2019 and entered into the following transactions during 2019:...
Dak Company began operations on August 1, 2019 and entered into the following transactions during 2019: 1. On August 1, Dak Company sold common stock to owners in the amount of $200,000 and borrowed 100,000 from the local bank on a 10-month, 12% note payable. 2. On September 1, Dak Company paid $50,000 cash to purchase supplies. 3. On October 1, Dak Company received $90,000 cash from a customer for services to be performed over the next nine months. 4....
XYZ Company began operations in 2019 and entered into the following transactions during the year: May...
XYZ Company began operations in 2019 and entered into the following transactions during the year: May 1: Sold common stock to owners for $200,000 cash. May 10: Purchased inventory costing $40,000 on account. June 1: Purchased equipment for $48,000 cash. The equipment was assigned a 10-year life and a $6,000 residual value. August 1: Purchased a two-year insurance policy for $24,000 cash. October 3: Sold one-half of the inventory that was purchased on May 10 to a customer for $49,000;...
Heidi Jara opened Martinez’s Cleaning Service on July 1, 2019. During July, the following transactions were...
Heidi Jara opened Martinez’s Cleaning Service on July 1, 2019. During July, the following transactions were completed. July 1 Stockholders invested $19,900 cash in the business in exchange for common stock. 1 Purchased used truck for $9,100, paying $4,200 cash and the balance on account. 3 Purchased cleaning supplies for $2,000 on account. 5 Paid $1,680 cash on a 1-year insurance policy effective July 1. 12 Billed customers $4,600 for cleaning services. 18 Paid $1,600 cash on amount owed on...
8. Brighton Company received $32,000 cash from the issue of common stock on January 1, 2019,...
8. Brighton Company received $32,000 cash from the issue of common stock on January 1, 2019, its first date of operations. During 2019, Brighton earned $14,500 of revenue on account. The company also collected $4,500 cash from accounts receivable and paid $2,000 cash for rent expense during 2019. The company also accrued $5,000 for salaries expense during 2019, payable in 2020. Based on this information alone, the cash balance at December 31, 2019 was a. $ 29,500. b. $ 34,500....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT