Question

Aggie Kids Parties Co. engaged in the following transactions during Jan 2018, its first month of operations: W. White and his brother each invested $20,000 of cash in exchange for stock in the company. Performed service for customers on account, $2,850 Purchased a building for $20,000 to use as a future office. Pald $2,000 and signed a 2 year note for the balance. Purchased $300 of office supplies. Paid cash. Received $2,000 as a deposit for a job to be performed in February DX Paid employee salaries of $950. Performed service for a customer and received the fee of $1,500. Received payments of $750 from customers on account. Received monthly utility bill of $125. This bill is due on February 15. Paid the following expenses: salary, $950; rent, $500. Counted $100 of office supplies remaining on hand. 31 What is Aggie's net income for January 2018? A. $24,175 B. $1,625 C. $4,275 D. $2,400 E. $4,375

Answer 1

Calculate net income

Revenue (2850+1500)	4350
Expense
Supplies expense	200
Salaries expense (950*2)	1900
Utilities expense	125
Rent expense	500
Total expense	2725
Net income	1625

So answer is b) $1625