X Company was created on September 1 and prepares monthly financial statements.

Question

X Company was created on September 1 and prepares monthly financial statements. During September, the company had the following transactions:

Received $99,000 from a group of investors and received a $99,000 loan from the bank.

Bought $8,311 of merchandise, $3,505 for cash and $4,806 on account.

Bought equipment costing $9,800, paying the manufacturer $5,200 in cash and promising to pay the remaining $4,600 next month.

Sold merchandise for $21,890, of which $17,766 was for cash and $4,124 was on account; cost of the merchandise was $10,945.

Paid $3,739 to suppliers for merchandise previously bought on account. Collected $2,952 from customers on account.

Paid wages of $5,880.

Paid a total of $595 for rent and insurance in advance.

Recorded depreciation of $1,500.

Recorded a total of $109 for rent and insurance that had expired.

5. What were total equities on September 30? ________

6. What was Net Income in September? _______________

I need an answer for 5 and 6! I only have an hour before it's due!! Thanks!

Explanation / Answer

Ans. 6

Ans 5

Income statement Goods Sold $    21,890.00 Less : Cost of Goods Sold $    10,945.00 Gross Profit $    10,945.00 Less :Expenses Wages $    5,880.00 Rent & Insurance $       595.00 Depriciation $    1,500.00 Rent & insurance (Expired) $       109.00 $      8,084.00 Net Income $      2,861.00

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