Brando & Diego Store provided the following data obtained from the single entry records for the current year.

January 1 December 31

Cash 750,000 900,000

Notes receivable 150,000 500,000

Accounts receivable 700,000 900,000

Merchandise Inventory 700,000 550,000

Equipment 600,000 550,000

Accrued income 250,000 400,000

Notes payable 300,000 200,000

Accounts payable 700,000 600,000

Unearned rent income 40,000 55,000

The cash book showed the following information

Balance, January 1 750,000

Receipts:

Accounts Receivable 1,400,000

Notes receivable 400,000

Cash sales 400,000

Proceed from note receivable

discounted with face value of 250,000 200,000

Rent income 80,000

Sale of equipment costing 200,000

with carrying amount of 70,000 150,000

Additional investment 100,000 2,730,000

Total 3,480,000

Payments

Notes payable 500,000

Accounts payable 1,000,000

Cash purchases 850,000

Equipment 50,000

Withdrawals 130,000

Expenses 50,000 2,580,000

Balance, December 31 900,000

Other information:

Sales returns made by customers 150,000

Accounts receivable written off 40,000

Purchase discounts on accounts payable paid 30,000

1. Compute for theNet Income using the capital approach

2. Compute for the following (accrual basis)

• Gross Sales
• Gross Purchases
• Rent Income
• Depreciation Expense

3. Prepare traditional income statement.