Following is a list of financial statement items and amounts for Tim Burr’s Tree

Question

Following is a list of financial statement items and amounts for Tim Burr’s Tree Service as of 12/31/X3, the end of its first year in operation.

1. Prepare the Income Statement for the year ended December 31, 20X3.

  Accounts Receivable $ 41,600   Accounts Payable 31,600   Cash 10,160   Common Stock 21,600   Notes Payable   10,320   Equipment 50,800   Service Revenue 108,000   Fuel Expense 10,160   Rent Expense 11,500   Advertising Expense 5,160   Salaries and Wages Expense 21,600   Retained Earnings ?   Dividends 20,540

Explanation / Answer

Statement showing computations Particulars Amount Revenues: Service Revenue                 108,000.00 Total Revenues                 108,000.00 Expenses: Fuel Expenses                   10,160.00 Rent Expenses                   11,500.00 Advertising Expenses                      5,160.00 Salaries and Wage Expense                   21,600.00 Total Expenses                   48,420.00 Net Income = 108,000 - 48,420                   59,580.00

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