Question
A) On December 31, 2019, Pack N-Deliver Company completed its first year of operations. The following information has been provided for the year: a. Sold
A) On December 31, 2019, Pack N-Deliver Company completed its first year of operations. The following information has been provided for the year:
a. Sold packing supplies for $30,000 and provided $280,000 of delivery services.
b. All packing supplies sales were for cash.
c. Collected $212,000 of delivery service revenue.
d. Paid $15,000 cash to rent packing equipment, with $10,000 for rental in 2019 and the remaining amount for rental in 2020.
e. Spent $4,000 cash to repair delivery equipment during the year.
f. Bought packing supplies at a total cost of $46,000 and paid for $25,000 of these supplies. There were $20,000 of these supplies that have not yet been sold or used.
g. Paid employees $80,000 during the year.
h. Paid $16,000 for advertising for the year.
i. Used $14,000 in fuel for the delivery equipment.
j. Sold investments for $8,000 that had been purchased earlier in the year for $7,000.
k. Ordered $500 in spare parts and supplies.
l. Income tax expense for the year is $18,000.
1) Prepare an accrual basis income statement for Pack-and-Deliver Company for the year ended December 31, 2019.
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