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Please prepare an income statement with the given information. You have been hired as an accountant for NFT Consulting Inc. This business was created when
Please prepare an income statement with the given information. You have been hired as an accountant for NFT Consulting Inc. This business was created when some friends decided to make use of their newly minted college degrees and go into business together. The business was created on November 1, 2017. The company will have a fiscal year end of October 31st. The initial formation transactions and early purchases for NFT Consulting Inc. resulted in the balances that are included in the first 2 columns of the Worksheet. (see the worksheet tab) | |
During November, the first month of operations, the following transactions occurred: | |
Date | Event |
1-Nov | Paid $7,200 for 12 months rent on office space |
2-Nov | Purchased office furniture for $8,950. |
3-Nov | Purchased $11,354 of additional office supplies on account. |
8-Nov | Borrowed 20,000 from the bank for operating cash. The note has a 3% interest rate (simple interest) and is to be paid back in 4 years |
15-Nov | Received $10,800 from Fortuna Inc. for work to be performed over the next 12 months. |
20-Nov | Paid $1,560 for utilities. |
21-Nov | Performed services for various customers for $13,200 cash and another $18,100 on account. |
25-Nov | Paid $8,650 for purchases of supplies previously made on account. |
27-Nov | Paid salaries to employees totaling $5,200 for 1 week. |
30-Nov | Collected $12,300 as payment for amounts previously billed. |
30-Nov | Dividends of $3,000 were declared and paid. |
At the end of November, the following additional information is available to help determine what adjustments are needed: | |
30-Nov | One month of the prepaid rent has been used up |
30-Nov | Supplies on hand are $8,150. |
30-Nov | One month of interest has accrued on the note payable for the bank loan. |
30-Nov | One month of the services for the Fortuna Inc. has been performed (see above). |
30-Nov | Salaries of $5,200 are paid every Friday (for a 5 day work week). November 30, 2017 was a Thursday. |
30-Nov | Additional work for customers of $9,580 has been performed during the last week of November but not yet billed |
30-Nov | Depreciation expense for the computer equipment is $140 and for the office furniture is $120 |
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