Help with the income statment

David Hamilton had worked as the senior technician at a large electronics sales and service company for more than 15 years. Just over two years ago, he decided that what he really wanted was to be self-employed. After turning in his resignation, he started his own company. Hamilton announced the opening of Hamilton's Electronics Services, Inc. (Hamilton's), an electronics repair company that serviced all makes and models of electronic equipment. As he reflected on his company's first two years of operation, he thought about how busy he had been. He was grateful that he had hired Janet Lucas, a local CPA, to handle the accounting for his company after its first year of operation, and he had renewed his contract with her for its second year. Hamilton provided Lucas with all the company's invoices, bank statements, and a lot of other miscellaneous businessrelated information. He had asked Lucas to reconstruct, in summary form, all the company's transactions that had occurred during its second year and to provide him with an income statement for its second year of operations and a balance sheet at the end of that year. Lucas got to work immediately. She had the company's balance sheet for the end of the first year (Exhibit 1). As she had discovered the previous year, the information Hamilton had provided her with contained everything she needed to complete a summary analysis of transactions, to transfer all the data into individual accounts, and to prepare an income statement and a balance sheet for the company's second year. From the information Hamilton had given her, Lucas prepared the following summary of things that had occurred during the company's second year of operations. 1. Throughout the year, the company purchased parts and supplies inventory totaling $75,000. Of the $75,000,$10,000 was cash paid at the time of purchase, and the remaining $65,000 was purchased on account. 2. Total sales for the year were $330,000. Of those, $110,000 were sales on account, $60,000 were cash sales, and $160,000 were credit card sales. The credit card company charged Hamilton's a 2\% fee for each sale. 3. The original cost of the parts and supplies inventory used was $69,000. 4. Rent for the facility in which the company operated remained at $1,000 throughout the year. The company had paid for the first two months' rent during December of the prior year. It paid for the remaining 10 months' rent during the current year. 5. The cost of insurance for the year was $1,200, paid in cash. David Hamilton had worked as the senior technician at a large electronics sales and service company for more than 15 years. Just over two years ago, he decided that what he really wanted was to be self-employed. After turning in his resignation, he started his own company. Hamilton announced the opening of Hamilton's Electronics Services, Inc. (Hamilton's), an electronics repair company that serviced all makes and models of electronic equipment. As he reflected on his company's first two years of operation, he thought about how busy he had been. He was grateful that he had hired Janet Lucas, a local CPA, to handle the accounting for his company after its first year of operation, and he had renewed his contract with her for its second year. Hamilton provided Lucas with all the company's invoices, bank statements, and a lot of other miscellaneous businessrelated information. He had asked Lucas to reconstruct, in summary form, all the company's transactions that had occurred during its second year and to provide him with an income statement for its second year of operations and a balance sheet at the end of that year. Lucas got to work immediately. She had the company's balance sheet for the end of the first year (Exhibit 1). As she had discovered the previous year, the information Hamilton had provided her with contained everything she needed to complete a summary analysis of transactions, to transfer all the data into individual accounts, and to prepare an income statement and a balance sheet for the company's second year. From the information Hamilton had given her, Lucas prepared the following summary of things that had occurred during the company's second year of operations. 1. Throughout the year, the company purchased parts and supplies inventory totaling $75,000. Of the $75,000,$10,000 was cash paid at the time of purchase, and the remaining $65,000 was purchased on account. 2. Total sales for the year were $330,000. Of those, $110,000 were sales on account, $60,000 were cash sales, and $160,000 were credit card sales. The credit card company charged Hamilton's a 2\% fee for each sale. 3. The original cost of the parts and supplies inventory used was $69,000. 4. Rent for the facility in which the company operated remained at $1,000 throughout the year. The company had paid for the first two months' rent during December of the prior year. It paid for the remaining 10 months' rent during the current year. 5. The cost of insurance for the year was $1,200, paid in cash