Glorious Gloria, a florist, had the following transactions in August: Earned $2,000 as revenues on account; collected $4,000 from a customer for goods sold last month; incurred $600 of repair expense and paid cash; paid $200 to a supplier that it owed from the previous month. What is the net income in August?
A)$500
B)$5,700
C)$2,700
D)$1,400

Question

Quizplus · Accepted Answer

Net income is calculated as revenues minus expenses. Gloria earned $2,000 in revenues and incurred $600 in repair expenses, resulting in a net income of $1,400 for August. The other transactions do not affect net income for August.

Glorious Gloria, a Florist, Had the Following Transactions in August