kimmel, Financial Accounting, Be Home Read, Study & Practice Gradebook ORION Dow
ID: 2540760 • Letter: K
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kimmel, Financial Accounting, Be Home Read, Study & Practice Gradebook ORION Downloadable eTextbook Assignment Assignment> Open A Blossom Company, a ski tuning and repair shop, opened on November 1, 2016. The company carefully kept track o Graded 044 Cash Cash Receipts Payments Issuance of common shares Payment to purchase repair shop equipment Payments to landlord Newspaper advertising payment Utility bill payments Part-time helper's wage payments Income tax payment Cash receipts from ski and snowboard repair services Subtotals Cash balance Totals $20,800 $9,060 1,190 345 950 2,250 10,900 Review Score Review Results by Stud 31,100 51,900 24,695 27,205 $51,900 $51,900 The repair shop equipment was purchased on November 1 and has an estimated useful Bie of 5 years. Lease payments $445 at Apri 30, 2017, for unpaid wages. At April 30, 2017, customers owe Blossom Company $485 for services they ha (a) Prepare an accrual-basis income statement for the 6 months ended April 30, 2017 H COMP Rights Reserved A Division of 2hn &s; elom" e e 89,@ Type here toExplanation / Answer
Blossom Company Income statement for the year ended on 30 April, 2017 Particulars Amount Revenue from service 31,585 Operating Expenses Rent 1,190 Advertisement 345 Utility bills 950 Salaries and Wages 2,695 Depreciation 1,812 6,992 Operating Profit 24,593 Income tax 10,900 Net Profit 13,693 Depreciation = Cost/number of useful life = 9060/5 = 1812 Salaries and wages include the amount of unpaid wages of $445 Revenue from service include the amount of services provided on account of $485 Customer owe $485 for service rendered by Blossom Company In accrual basis, revenue is reported when they are earned not when the cash is received similarly, expenses are recorded when they occur, not when the cash is paid.
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