A company completed the following transactions during the month of October: I. Purchased office supplies on account, $4800.
II. Provided services for cash, $22,000.
III. Provided services on account, $12,000.
IV. Collected cash from a customer on account, $7400.
V. Paid the monthly rent of $18,000.
What was the company's net income for the month?
A)$12,000
B)$16,000
C)$34,000
D)$52,000

Question

Quizplus · Accepted Answer

Net income is calculated as total revenues minus total expenses. The company earned $22,000 in cash services and $12,000 in services on account, totaling $34,000 in revenues. The only expense mentioned is the rent of $18,000. Therefore, net income is $34,000 - $18,000 = $16,000.

A Company Completed the Following Transactions During the Month of October