During January 2015, the first month of operations, a consulting firm had following transactions:
1.Issued common stock to owners in exchange for $20,000 cash.
2.Purchased $5,000 of equipment, paying $1,000 cash and signing a promissory note for $4,000.
3.Received $9,000 in cash for consulting services performed in January.
4.Purchased $1,500 of supplies on account; all of the supplies were used in January.
5.Provided consulting services on account in the amount of $16,000.
6.Paid $750 on account.
7.Paid $3,000 to employees for work performed during January.
8.Received a bill for utilities for January of $3,400; the bill remains unpaid.
-Use the information above to answer the following question.What is subtotal of expenses that will be reported on the income statement for the month ended January 31?
A) $3,750.
B) $7,900.
C) $8,150.
D) $4,500.

Question

Quizplus · Accepted Answer

Expenses that will be reported on the income statement for the month ended January 31 are:Supplies expense: $1,500Utilities expense: $3,400Salaries expense: $3,000Total expenses: $7,900

During January 2015, the First Month of Operations, a Consulting