on december 31, a company had the following accounts with normal balances. notes payable $27,000 accumulated…

on december 31, a company had the following accounts with normal balances. notes payable $27,000 accumulated depreciation - equipment $31,000 prepaid insurance 4,100 accounts receivable 7,200 interest expense 620 advertising expense 2,900 accounts payable 9,500 interest payable 740 salaries payable 2,000 unearned revenue 1,600 cash 42,000 office supplies expense 520 salaries expense 9,100 equipment 200,000 insurance expense 3,400 dividends 11,400 common stock 22,000 depreciation expense - equipment 18,000 retained earnings 30,000 office supplies 3,600 services revenue 87,500 retail revenue 12,500 complete this question by entering your answers in the tabs below. prepare the income statement for the year ended december 31.

on december 31, a company had the following accounts with normal balances. notes payable $27,000 accumulated depreciation - equipment $31,000 prepaid insurance 4,100 accounts receivable 7,200 interest expense 620 advertising expense 2,900 accounts payable 9,500 interest payable 740 salaries payable 2,000 unearned revenue 1,600 cash 42,000 office supplies expense 520 salaries expense 9,100 equipment 200,000 insurance expense 3,400 dividends 11,400 common stock 22,000 depreciation expense - equipment 18,000 retained earnings 30,000 office supplies 3,600 services revenue 87,500 retail revenue 12,500 complete this question by entering your answers in the tabs below. prepare the income statement for the year ended december 31.

Answer

Explanation:

Step1: Identify revenue - related accounts

Services revenue is $87,500 and Retail revenue is $12,500.

Step2: Calculate total revenues

Total revenues = Services revenue+Retail revenue = $87,500 + $12,500=$100,000.

Step3: Identify expense - related accounts

Interest expense is $620, Advertising expense is $2,900, Salaries expense is $42,000, Office supplies expense is $520, Insurance expense is $1,100, Depreciation expense - Equipment is $18,400.

Step4: Calculate total expenses

Total expenses = $620 + $2,900+ $42,000 + $520+ $1,100+ $18,400 = $65,540.

Answer:

Income Statement Year Ended December 31
Revenues
Services revenue $87,500
Retail revenue $12,500
Total revenues $100,000
Expenses
Interest expense $620
Advertising expense $2,900
Salaries expense $42,000
Office supplies expense $520
Insurance expense $1,100
Depreciation expense - Equipment $18,400
Total expenses $65,540