Question

The following accounts were taken from the Adjusted Trial Balance columns of the work sheet: Accumulated Depreciation $2,783 Fees Earned 14,403 Depreciation Expense 1,343 Insurance Expense 513 Prepaid Insurance 4,756 Supplies 1,238 Supplies Expense 3,322 Net income for the period is a.$19,581 b.$9,225 c.$6,442 d.$5,178

Answer 1

Answer:

b. $ 9,225

Explanation:

The net income needs to be computed considering the revenue and expenses items from the data provided.

Revenues

Fees earned                                                              $ 14,403

Expenses

Depreciation expenses                 $  1,343

Insurance expenses                      $     513

Supplies expenses                        $  3,322

Total expenses                                                          $   5.178

Net income                                                                 $ 9,225

The other items in the question i.e. Accumulated depreciation, Prepaid insurance and Supplies are balance sheet items and are not considered in determining the net income