Question

Joe Jackson opened Jackson's Repairs, Inc. on March 1 of the current year. During March, the following transactions occurred and were recorded in the company's books:1. Jackson invested $25,000 cash in the business.2. Jackson contributed $100,000 of equipment to the corporation.3. The company paid $2,000 cash to rent office space for the month.4. The company received $16,000 cash for repair services provided during March.5. The company paid $6,200 for salaries for the month.6. The company provided $3,000 of services to customers on account.7. The company paid cash of $500 for monthly utilities.8. The company received $3,100 cash in advance of providing repair services to a customer.Based on this information, net income for March would be:

Answer 1

Answer: $10,300

Explanation:

Total expenses = Rent Expense + Utility expense + Salaries Expense

                          = $2,000 + $500 + $6,200

                          = $8,700

Revenue from Repair Service = 16,000 cash received + 3,000 provided on account

                                                 = $16,000 + $3,000

                                                = $19,000

Net income = Revenue from Repair Service - Total expenses

                    = $19,000 - $8,700

                    = $10,300