Income Statement

Question

The following account balances were taken from the adjusted trial balance for Shaw Messenger Service, a delivery service firm, for the fiscal year ended April 30, 20Y1:

Line Item Description Amount
Depreciation Expense $9,300
Fees Earned 493,800
Insurance Expense 1,770
Miscellaneous Expense 3,720
Rent Expense 70,700
Salaries Expense 248,300
Supplies Expense 3,160
Utilities Expense 27,000

Prepare an income statement.

Shaw Messenger Service
Income Statement
For the Year Ended April 30, 20Y1
Line Item Description Amount Amount

$- Select -
Expenses:

Answer 1

Here is the completed income statement for Shaw Messenger Service for the fiscal year ended April 30, 20Y1:

Shaw Messenger Service
Income Statement
For the Year Ended April 30, 20Y1

| Line Item Description | Amount | |----------------------------|-------------| | Fees Earned | $493,800 | | Total Revenue | $493,800 | | | | | Expenses: | | | Depreciation Expense | $9,300 | | Insurance Expense | $1,770 | | Miscellaneous Expense | $3,720 | | Rent Expense | $70,700 | | Salaries Expense | $248,300 | | Supplies Expense | $3,160 | | Utilities Expense | $27,000 | | Total Expenses | $363,950 | | | | | Net Income | $129,850 |

Explanation:

1. Revenue: The only revenue line item is Fees Earned, totaling $493,800.
2. Total Expenses: The sum of all expenses (Depreciation, Insurance, Miscellaneous, Rent, Salaries, Supplies, Utilities) is calculated to be $363,950.
3. Net Income: This is calculated by subtracting Total Expenses from Total Revenue:
   • Net Income = Total Revenue - Total Expenses
   • Net Income = $493,800 - $363,950 = $129,850.

This income statement reflects the financial performance of Shaw Messenger Service for the year ended April 30, 20Y1.