Question

Part 2: Below is a fact scenario. Using the bou provided to the right, prepare an income statement for Tiffany's Catering Service for the year ending December 31, 2019, demonstrating that Tiffany earned income of $93,900. Assume the company will not be subject to income tax. During the spring semester of her senior year, Tiffany decided to open a catering service business. She started business on January 1, 2019. She rented a small kitchen space and purchased a stove, supplies, and food. To acquire these items, she invested some of her own money and she borrowed from the bank by signing a two-year note payable promising to pay interest every 12 months with the first interest payment due December 31, 2019. The principal is due at the end of 2020. At the end of 2019 Tiffany had no supplies or food left over. A review of the checkbook showed the following Bank deposits of collections from customers totaled $90,000. The following checks had been written: disposable plates and utensils, $6,200; load, $7,100; buying a used stave $12,000, repairs to her stove, $900, workers' wages, $10,000; interest on the loan, $200, cell phone bill, $1,200; rent, $6,000. A notebook kept in the kitchen reflected the following: Customers still owed her $40,000 for catering services already rendered and she owed $2,500 for disposable plates and utensils (credit card charges). In addition, Tiffany estimated that she used up one sixth of the stove during 2019,

Answer 1

Income statement is statement prepared for showing prepared for showing the profit or loss of the organisation. Every organisation prepares the income statement weather it is large or small.It is calculated by deducting all the expenses from the revenue during the specific period of time.

Income statment for the Tiffin's Catering service for the year ending 31January 2019. porticular catering Service Revenue Bank depasit hom customers Receirable árom customere 90000 40000 130000 Less: cast of catering Servise pisposable plates and utensils Add: Amout payable. Food 6,200 2500 8,700 구, 100 Buying a used stoke Lessi 12,000 10000 2000 116 the stove is used GeuSS Maram warker's wages Gross Margin Less: operating cast Repair to stoye Interest on |10000 2780으 102,200 900 LOgn 200 Cell phane bill Rent Net Income 1,200 60008300 93.900