Question

Pat's Custom Tuxedo Shop maintains its records on the cash basis. During this past year Pat's collected $43,300 in tailoring fees, and paid $12,300 in expenses. Depreciation expense totaled $2,500. Accounts receivable increased $1,050, supplies increased $4,300, and accrued liabilities increased $2,350. Pat's accrual-basis net income was:

Answer 1

net income = $31,500

Step-by-step explanation:

given data

collect tailoring fees = $43,300

paid expenses = $12,300

Depreciation expense= $2,500

Accounts receivable = $1,050

supplies increased = $4,300

liabilities increased = $2,350

to find out

accrual basis net income

solution

we get here net income by given expression that is

net income = tailoring fees - expenses paid + account receivable + supplies increased - liabilities increased - Depreciation expense .......1

put here value

net income = $43,300 - $12,300 + $1,050 + $4,300 - $2,350 - $2,500

net income = $31,500