Question

The adjusted trial balance of Parsons Company at December 31, 2020, includes the following accounts: Common Stock $15,600, Dividends $7,000, Service Revenue $37,000, Salaries and Wages Expense $16,000, Insurance Expense $2,000, Rent Expense $4,000, Supplies Expense $1,500, and Depreciation Expense $1,300.
Required:
Prepare an income statement for the year.

Answer 1

Answer:

$12,200

Explanation:

Preparation of an income statement for the year.

PARSONS COMPANY Income Statement

For the year ended December 31,2020

Service Revenue $37,000

Expenses:

Salaries and wages $16,000

Insurance Expense $2,000

Rent Expense $4,000

Supplies Expense $1,500

Depreciation Expense $1,300

Total Expenses $24,800

Net Income $12,200

($37,000-$24,800)

Therefore income statement for the year is $12,200