The following accounts are taken from the December 31, 2010, financial statement

Question

The following accounts are taken from the December 31, 2010, financial statements of A to Z Advertising Company:

  

  

Incurred $45,750 of operating expenses of which $39,750 was paid in cash and $6,000 was on account and unpaid as of the end of the year.

  What is the amount of Net Income for the year ended December 31, 2010?

What is the amount of Accounts receivable at the end of 2011?

The following accounts are taken from the December 31, 2010, financial statements of A to Z Advertising Company:

Explanation / Answer

Answer:

In $ In $ Advertising revenue 47,982 less: Unearned revenue 1,328 A Net Revenue 46,654 Operating expenses 38,210 Interest expense 2,374 Income tax expense 2,476 B Total expenses 43,060 C = A-B Net Income 3,594

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