Question

The following information was reported in the December 31, 2017, financial statements of National Airways, Inc. (listed alphabetically, amounts in millions).
Accounts Payable $4,650
Accounts Receivable 580
Aircraft Fuel Expense 8,700
Cash 2,970
Common Stock 1,220
Dividends 20
Equipment 14,370
Income Tax Expense 260
Interest Expense 130
Landing Fees Expense 3,100
Notes Payable 6,950
Repairs and Maintenance Expense 1,200
Retained Earnings (as of December 31, 2017) 5,780
Salaries and Wages Expense 3,280
Supplies 680
Ticket Revenues 17,100

Required:
Prepare an income statement for the year ended December 31, 2017.

Answer 1

Answer:

National Airways, Inc.

                                       (amounts in millions)

NATIONAL AIRWAYS, INC.

Income Statement for the year ended December 31, 2017:

Ticket Revenues                                             $17,100

Less Expenses:

Aircraft Fuel Expense                    8,700

Landing Fees Expense                  3,100

Repairs & Maintenance Expense  1,200

Salaries and Wages Expense       3,280

Interest Expense                               130           16,410

Income before tax                                              $690

Income Tax Expense                                            260

Net Income                                                         $430

Explanation:

a) Data:

National Airways, Inc.

                                              (amounts in millions)

Cash                                              $2,970

Accounts Receivable                         580

Supplies                                             680  

Equipment                                     14,370  

Dividends                                            20

Aircraft Fuel Expense                    8,700

Landing Fees Expense                  3,100

Repairs & Maintenance Expense  1,200

Salaries and Wages Expense       3,280

Interest Expense                               130

Income Tax Expense                       260

Ticket Revenues                                             $17,100

Accounts Payable                                             4,650

Notes Payable                                                   6,950

Common Stock                                                  1,220

Retained Earnings (as of December 31, 2017) 5,780

b) The National Airways' income statement shows the revenue generated by the organization and the incidental expenses that were incurred in generating the revenue and running the organization.  After deducting the expenses from the revenue, the resulting figure is called the net income or loss.