The following is selected information from Alpha-Beta-Gamma Corporation for the

Question

The following is selected information from Alpha-Beta-Gamma Corporation for the fiscal year ending October 31, 2010. Cash received from customers $300,000 Revenue earned 350,000 Cash paid for expenses 170,000 Cash paid for computers on November 1, 2009 that will be used for 3 years (annual depreciation is $16,000) 48,000 Expenses incurred, not including any depreciation 200,000 Proceeds from a bank loan, part of which was used to pay for the computers 100,000 Based on the accrual basis of accounting, what is Alpha-Beta-Gamma Corporation

Explanation / Answer

assuming the corporation keeps accounts on accrual basis l) , total earnings = revenue earned = $350,000 expenses = $200,000 + $16,000 (depreciation) = $2,16,000 net income = $350,000 - $216,000 = $1,34,000= ANSWER $1,34,000

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