Mostert music company had the following transactions in March: A. Sold instrumen

Question

Mostert musiccompany had the following transactions in March: A. Sold instruments to customers for$10,000, recieved $6,000in cash and the rest on account. The cost of the instrument was $7,000. B. Purchased $4,000 of new instruments inventory, paid $1,000in cash and owed the rest on account. C. Paid $600 wages for the month D. Recieved a $ 2,000 bill for utilities that will be paid inApril. E. Rcieved $1,000 from customers as deposits on orders of newinstruments to be sold to the customers in April. Complete the following: Cash basis Incomesstatement                              Accrualbasis incomestatement Revenues:                                                            Revenues: CashSales         $                                                Salesto customers   $ Customerdeposits                                                Expenses: Expenses:                                                            Costsof sales Inventorypurchases                                             Wagesexpense: Wagespaid   ___________                                 Utiliitesexpense:   ___________ CashIncome   $_________                                 NetIncome:         $___________ Mostert musiccompany had the following transactions in March: A. Sold instruments to customers for$10,000, recieved $6,000in cash and the rest on account. The cost of the instrument was $7,000. B. Purchased $4,000 of new instruments inventory, paid $1,000in cash and owed the rest on account. C. Paid $600 wages for the month D. Recieved a $ 2,000 bill for utilities that will be paid inApril. E. Rcieved $1,000 from customers as deposits on orders of newinstruments to be sold to the customers in April. Complete the following: Cash basis Incomesstatement                              Accrualbasis incomestatement Revenues:                                                            Revenues: CashSales         $                                                Salesto customers   $ Customerdeposits                                                Expenses: Expenses:                                                            Costsof sales Inventorypurchases                                             Wagesexpense: Wagespaid   ___________                                 Utiliitesexpense:   ___________ CashIncome   $_________                                 NetIncome:         $___________

Explanation / Answer

Cash Basis Income Statement Cash Sales 6,000.00 Customer deposits 1,000.00 7,000.00 Expenses: Inventory purchases 1,000.00 Wages 600.00 Cash Income 5,400.00 Accrual Basis IncomeStatement Sales to Customers 10,000.00 Cost of Sales 7,000.00 Gross Profit 3,000.00 Wage Expense 600.00 Utlity Expense 2,000.00 Net Income 400.00

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