Final answer:
To prepare a hair stylist's income statement for the year ended, one must list all revenues and expenses from the adjusted trial balance and subtract total expenses from total revenues to determine the net income or loss for the year.
Step-by-step explanation:
To prepare an income statement for the year ended from a hair stylist's adjusted trial balance, we need to list all revenue and expense accounts from the adjusted trial balance. The income statement reflects the company's financial performance over a specific period, often over the course of a fiscal year. Revenues are listed first, followed by expenses, and the difference between the two is the net income or loss for the period.
Here’s a general outline for an income statement:
- Revenue: Summarize all the income sources from the adjusted trial balance.
- Expenses: List out and sum up all expenses from the adjusted trial balance.
- Net Income: Subtract total expenses from total revenue to calculate the net income or loss.
After completing these steps, you will have constructed an income statement that presents the profitability of the hair stylist's business for the year.