Question

Exercise 4-6 (Part Level Submission) Franken Company, a ski tuning and repair shop, opened on November 1, 2016. The company carefully kept track of all its cash receipts and cash payments. The follow information is available at the end of the ski season, April 30, 2017. Issuance of common shares Payment to purchase repair shop equipment Payments to landlord Newspaper advertising payment Utility bill payments Part-time helper's wage payments Income tax payment Cash receipts from ski and snowboard repair services Subtotals Cash Cash Receipts Payments $20,000 $9,200 1,225 375 970 2,600 10,000 32,150 52,150 24,370 27,780 $52,150 $52,150 Cash balance Totals The repair shop equipment was purchased on November 1 and has an estimated useful life of 4 years. Lease payments to the landlord are made at the beginning of e The payments to the landlord included a security deposit of $175. The part-time helper is owed $420 at April 30, 2017, for unpaid wages. At April 30, 2017, customer

Answer 1

FRANKEN COMPANY Income Statement April 30, 2017
Revenues :
Service revenue ($ 32,150 + $ 540)		$ 32,690
Less: Expenses
Depreciation expense ( $ 9,200 / 4 Years x 6 / 12 )	$ 1,150
Rent expense ($ 1,225 (-) $ 175)	$ 1,050
Advertising expense	$ 375
Utilities expense	$ 970
Salaries and wages Expense ($ 2,600 + $ 420)	$ 3,020
Income tax Expense	$ 10,000
Total Expenses		($ 16,565 )
Net income / (loss)		$ 16,125