Question

Jiminez, Inc., had the following transactions during the month of March, current year. Prepare an income statement based on this information, being careful to include only those items that should appear in that financial statement.

1. Cash received from bank loans was $10,000.

2. Revenues earned and received in cash were $9,000.

3. Dividends of $4,000 were paid to stockholders.

4. Expenses incurred and paid were $5,600.

	JIMINEZ, INC. Income Statement For the Month Ended March 31, Current Year Revenues $0

Answer 1

The income statement is prepared below:

JIMINEZ Inc.
Income statement
For the month ended March 31, Current year
Revenue & Gains	Amount ($)
Revenue earned	9,000
Total revenue & gains (A)	9,000
Expense and losses:
Expense Incurred	5,600
Total expenses (B)	5,600
Net income (A - B)	3,400

Notes:

1. Cash received from bank loan only affect the balance sheet account, this transaction does not appear in the income statement.

2. Dividend paid to stockholders' does not appear in income statement it is shown under the retained earning statement.

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Answer 2