Exercise 1-15 Preparing an income statement LO P2

Required information

Use the following information for exercises 15 to 18 LO P2

[The following information applies to the questions displayed below.]

On October 1, Ebony Ernst organized Ernst Consulting; on October 3, the owner contributed $84,580 in assets in exchange for its common stock to launch the business. On October 31, the company’s records show the following items and amounts.  

Cash	$	9,390		Cash dividends	$	2,650
Accounts receivable		16,000		Consulting revenue		16,000
Office supplies		3,830		Rent expense		4,190
Land		45,980		Salaries expense		7,570
Office equipment		18,550		Telephone expense		830
Accounts payable		9,060		Miscellaneous expenses		650
Common Stock		84,580

Exercise 1-15 Preparing an income statement LO P2

Using the above information prepare an October income statement for the business.

ERNST CONSULTING
Income Statement
For Month Ended October 31
Revenues
Consulting revenue	$16,000
Total revenues		$16,000
Expenses
Salaries expense	7,570
Rent expense	4,190
Telephone expense	830
Miscellaneous expenses	650
Total expenses		13,240
Net income		$2,760