Question

As of December 31, 2019, Armani Company’s financial records show the following items and amounts.

Cash $ 10,000
Accounts receivable 9,000
Supplies 6,000
Equipment 5,000
Accounts payable 11,000
A. Armani, Capital, Dec. 31, 2018 16,000
A. Armani, Capital, Dec. 31, 2019 19,000
A. Armani, Withdrawals 13,000
Consulting revenue 33,000
Rental revenue 22,000
Salaries expense 20,000
Rent expense 12,000
Selling and administrative expenses 8,000
Required:
Prepare the 2019 year-end income statement for Armani Company.

Answer 1

Answer:

Revenue (Consulting revenue + Rental revenue)=33000+22000=55000.

Operating expense (salaries expense+rent expense)=20000+12000=32000

Selling and administrative expense = 8000

Explanation:

                                       Armani Company

                               Year end Income statement 2019

Revenue                                                                            = 55000

less: Operating expense                                                  =(32000)

                                            Gross Profit                             23000

less :Selling and administrative expense                         = (8000)

                                              Net profit                                  15000

Notes: Question should be mentioned the company nature of business so that we can identify company real business.