Question

Required information [The following information applies to the questions displayed below.) On October 1, Ebony Ernst organized Ernst Consulting, on October 3. the owner contributed $85.460 in assets to launch the business. On October 31, the company's records show the following items and amounts. $ $ Cash Accounts receivable office supplies Land Office equipment Accounts payable Owner investments 6,650 Cash withdrawals by owner 15,520 Consulting revenue 4,640 Rent expense 46,000 salaries expense 19,560 Telephone expense 9,890 Miscellaneous expenses 85,460 3,490 15,520 4,920 8,500 890 700 Using the above information prepare an October income statement for the business. ERNST CONSULTING Income Statement

Answer 1

Solution to the First Question

ERNST CONSULTING
Income Statement
Particulars	Amount ($)	Amount ($)
Revenues
Consulting Revenue	15,520
Total Revenues (a)		15,520
Expenses
Rent Expenses	4,920
Salaries Expenses	8,500
Telephone Expenses	890
Miscellaneous Expenses	700
Total Expenses (b)		15,010
Net Income (a) - (b)		510

Solution to the Second Question

ARMANI COMPANY
Income Statement
For the year ended December 31, 2017
Particulars	Amount ($)	Amount ($)
Revenues
Consulting Revenue	33,000
Rental revenue	22,000
Total Revenues (a)		55,000
Expenses
Salaries expenses	20,000
Rent Expenses	12,000
Selling and administrative expenses	8,000
Total Expenses (b)		40,000
Net Income (a) - (b)		15,000