Question

The adjusted trial balance of Pronghorn Corp at December 31, 2022, includes the following accounts: Retained Earnings $17,000, Dividends $6,700, Service Revenue $36,300, Salaries and Wages Expense $14,000, Insurance Expense $1,880, Rent Expense $4,080, Supplies Expense $1,440, and Depreciation Expense $900.

Required:
Prepare an income statement for the year.

Answer 1

Answer and Explanation:

The preparation of the income statement is presented below:

Service Revenue $36,300

Less:

Salaries and Wages Expense $14,000

Insurance Expense $1,880

Rent Expense $4,080

Supplies Expense $1,440

Depreciation Expense $900

Net income $14,000

Basically we subtracted the expenses from the revenues in order to get the net income