Check my weork 3 Rowland & Sons Air Transport Service, Inc., has been in operati
ID: 2333957 • Letter: C
Question
Check my weork 3 Rowland & Sons Air Transport Service, Inc., has been in operation for three years. The following transactions occurred in February: Feb. 1 Paid $520 for rent of hangar space in February Feb. 4 Received customer payment of $880 to ship several itens to Philadelphia next month. Feb. 7 Flev cargo from Denver to Dallas; the customer paid in full ($1,270 cash). Feb.10 Incurred and paid $1,600 in pilot wages for flying in February Feb.14 Paid $170 for an advertisement run in the local paper on February 14. ts Flew asked to be billed $1,780. for $2,305; one custoner paid $525 cash and the other Feb.18 Feb.25 Purchased on account $1,835 in supplies for future use on the planes. Hint Print Required 1. Prepare accrual basis journal entries for each transaction. 2. Calculate the company's preliminary net income. 3. Calculate the company's net profit margin expressed as a percent. Complete this question by entering your answers in the tabs below Required 1Required 2 Required 3 s preliminary net income. Calculate the Net Income 3 of 6H Next >Explanation / Answer
Journal entries: Date Accounts title and explanations Debit $ Credit $ 1-Feb Rent expenses Dr. 520 Cash account 520 4-Feb Cash account Dr. 880 Unearned revenue 880 7-Feb Cash account Dr. 1270 Service revenue 1270 10-Feb Salaries expense Dr. 1600 Cash account 1600 14-Feb Advertisement expense Dr. 170 Cash account 170 18-Feb Cash account Dr. 525 Accounts receivable Dr. 1780 Service revenue 2305 25-Feb Supplies account Dr. 1835 Cash account 1835 Preliminary Net Income: Revenue (1270+2305) 3575 Less: Expenses Rent expenses 520 Salaries expenses 1600 Advertisement expense 170 Total expenses 2290 Net income 1285 Net income margin % = Net income / Service revenue *100 1285 / 3575 *100 = 35.94%