CARLOS KNOWS REALTY In June of this year, Carlos Ivy set up a business under the

Question

CARLOS KNOWS REALTY In June of this year, Carlos Ivy set up a business under the name of Carlos Knows Realty. The transactions (business events) completed during the month are as follows:

Date

1 Deposited $12,000 in a bank account entitled Carlos Knows Realty.

1 Paid office rent for the month, $900.

3 Bought supplies consisting of stationary, folders, and stamps for cash, $364.

4 Bought office equipment consisting of a calculator, personal computer, and a check writer on account from Baxter Company, $6,200.

8 Received bill from the Daily Times for advertising, $382.

15 Paid $900 to Baxter Company as part payment on purchase of office equipment recorded previously on 4th.

17 Earned sales commissions, receiving cash, $3,160.

25 Received and paid bill for utilities, $148.

26 Paid bill for advertising recorded previously on the 8th, $382.

27 Paid automobile expenses, $256.

30 Carlos withdrew cash for personal use, $1,030.

TO-DO: 1. Tell me, "how much money" (net income) did Carlos' business make in the first month of operations.

Explanation / Answer

Carlos Knows Realty

Income Statement

For the month ended.....

Carlos' business made $ 1,474 in the first month of operations.

$ $ Sales Commision Earned 3,160 Operating Expenses Rent Expense 900 Advertising Expense 382 Utilities Expense 148 Automobile Expense 256 Total Operating Expenses 1,686 Net Income 1,474

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