Question $3$

Hammerstone Consulting provides risk management services to individuals and to corporate clients. The company closes its temporary accounts once each year on December $31.$ The company recently issued the following income statement as part of its annual report.

HAMMERSTONE CONSULTING

INCOME STATEMENT

FOR THE YEAR ENDED DECEMBER $31,$ CURRENT YEAR

Rovenue:

Consulting reveriue$-$Individual cllents

Consulting reverue$-$corporate cllents

$$60,000$

$240,000$

$$300,000$

$$60,000$

$240,000$

$$300,000$

Expenses:

Advertising expense

Depreclation expense: compurers

Rent expense

$$24,000$

Office supplles expense

$36,000$

$14\mathrm{.}400$

Trevol expense

$6\mathrm{.}600$

Utilties expense.

$86\mathrm{.}700$

Telephone and Internet expense

$4\mathrm{.}950$

$2,850$

Salaries expense

$233\mathrm{.}250$

Interest expense

Nolloss

$3\mathrm{.}750$

$412\mathrm{.}500$

$$(112,500)$