Question

Sweet Catering completed the following selected transactions during May 2016:
May 1: Prepaid rent for three months, $2,100 May 5: Received and paid electricity bill, $100 May 9: Received cash for meals served to customers, $1,950 May 14: Paid cash for kitchen equipment, $2,430 May 23: Served a banquet on account, $2,550 May 31: Made the adjusting entry for rent (from May 1). May 31: Accrued salary expense, $1,400 May 31: Recorded depreciation for May on kitchen equipment, $380
	If Sweet Catering had recorded transactions using the Cash method, how much net income (loss) would they have recorded for the month of May? If there is a loss, enter it with parentheses or a negative sign.

Answer 1

Calculate net income

May 1	-2100
May 5	-100
May 9	1950
May 14	-2430
Net income under cash method	-2680