Question

Nona Curry started her own consulting firm, Curry Consulting Inc., on May 1, 2022. The following transactions occurred during the month of May. May 1 Stockholders invested $ 15,000 cash in the business in exchange for common stock. 2 Paid $ 600 for office rent for the month. 3 Purchased $ 500 of supplies on account. 5 Paid $ 150 to advertise for the month in the County News. 9 Performed services for customer for $ 1,400 cash. 12 Paid $ 200 cash dividend. 15 Performed $ 4,200 of services on account. 17 Paid $ 2,500 for employee salaries. 20 Paid for the supplies purchased on account on May 3. 23 Received a cash payment of $ 1,200 for services performed on account on May 15. 26 Borrowed $ 5,000 from the bank on a note payable. 29 Purchased office equipment for $ 2,000 paying $ 200 in cash and the balance on account. 30 Paid $ 180 for utilities.Prepare an income statement for the month of May 2022.

Answer 1

Curry Consulting Inc.'s Income Statement for the month ended May 31, 2022 is as follows:

Service Revenue                        $5,600

Expenses:

Office Rent Expense           $600

Advertising Expense              150

Salaries Expense               2,500

Utilities Expense                    180

Total expenses                           $3,430

Net Income                                 $2,170

Data Analysis:

May 9, Service Revenue   $1,400

May 15, Service Revenue $4,200

Total Service Revenue for the month =  $5,600 ($1,400 + $4,200)

May 2, Office Rent Expense $600

May 5, Advertising Expense $150

May 17, Salaries Expense $2,500

May 30 Utilities Expense $180

Thus, the income statement for the month of May, 2022 produces a net income of $2,170 which is the difference between the total service revenue and the total expenses.

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