33. Use the following information: Sheepakin Company had the following transacti

Question

33. Use the following information: Sheepakin Company had the following transactions during 2016 Collectca $2000 for services to be performed in 2017 Sales of $4,500 on account Paid $625 cash in salaries. Purchased airline tickets for $250 in December for a trip to take place in 2017 ey0 are rerevenmit th is Sheepskin's 2016 net income using accrual accountin $3,875. $5,875. 625 ) $3,625. Exp peyc Vet inc 34. Use the following infomation 5u25 Sheepskin Company had the following transactions during the 20 Sales of $4,500 on account. Collected $2,000 for services to be performed in 2017. Paid $625 cash in salaries. Purchased airline tickets for $250 in December for a trip to take place in 2017 Co What is Sheepskin's 2016 net income using cash basis accounting? A) $5,875. 15 -250 875 Page 9 4500 t2000 4500-7S 2000 500-15

Explanation / Answer

(33) Sales on account – Salary Paid

     = 4500 – 625 = 3875

Option A is correct

(34) Collect for service perform in 2017 – Salary Paid – Purchase airline ticket

= 2000 – 625 – 250 = 1125

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