Question

"During January 2018, the first month of operations, a consulting firm had following transactions:

Issued common stock to owners in exchange for $10,000 cash.
Purchased $2,500 of equipment, paying $750 cash and signing a promissory note for $1,750.
Received $4,500 in cash for consulting services performed in January.
Purchased $750 of supplies on account; all of the supplies were used in January.
Provided consulting services on account in the amount of $8,000.
Paid $375 on account.
Paid $1,500 to employees for work performed during January.
Received a bill for utilities for January of $1,700; the bill remains unpaid.

What is the amount of total revenue to be reported on the income statement for the month of January?"

Answer 1

The total revenue to be reported on the income statement for the month of January is $12,500.

Step-by-step explanation:

The amount of total revenue to be reported on the income statement for the month of January can be calculated by adding up all the cash and accounts receivable received from consulting services performed during January. In this case, the consulting firm received $4,500 in cash and provided consulting services on account for $8,000. Therefore, the total revenue for the month of January would be $4,500 (cash received) + $8,000 (accounts receivable) = $12,500.