Joe Jackson opened Jackson's Repairs, Inc. on March 1 of the current year. During March, the following transactions occurred and were recorded in the company's books: 1. Jackson invested $25,000 cash in the business.
2) Jackson contributed $100,000 of equipment to the corporation.
3) The company paid $2,000 cash to rent office space for the month.
4) The company received $16,000 cash for repair services provided during March.
5) The company paid $6,200 for salaries for the month.
6) The company provided $3,000 of services to customers on account.
7) The company paid cash of $500 for monthly utilities.
8) The company received $3,100 cash in advance of providing repair services to a customer.
Based on this information, net income for March would be:
A)$10,300.
B)$13,400.
C)$5,300.
D)$8,400.
E)$13,500.

Question

Quizplus · Accepted Answer

Net income is calculated as total revenues minus total expenses. Revenues include $16,000 from repair services and $3,000 from services on account, totaling $19,000. Expenses include $2,000 for rent, $6,200 for salaries, and $500 for utilities, totaling $8,700. Therefore, net income is $19,000 - $8,700 = $10,300.

Joe Jackson Opened Jackson's Repairs, Inc