Reference no: EM132640961
Question - Revenue and Expense Recognition
During September 2018, Alexander Company under- took the following transactions on the dates specified:
Sept. 1 Paid $400 for insurance for the next four months.
Sept. 1 Borrowed $6,000 from the local bank at an annual rate of 4%. The loan and interest will be repaid in one year (on Sept. 1, 2020).
Sept. 1 Purchased equipment for $15,000 cash. The estimated useful life of the equipment is 10 years.
Sept. 2 Purchased inventory from suppliers for $8,500 on account.
Sept. 2 Paid employees $3,200 for their August salaries.
Sept. 5 Sold goods to customers for $7,600 on account. The cost of the goods to Alexander was $4,400.
Sept. 8 Received an order from a customer for $350 of goods that will be delivered in October.
Sept. 15 Paid suppliers $8,500 cash for goods purchased on the 2nd.
Sept. 26 Collected $5,800 from customers for goods sold on the 5th.
Sept. 26 Sold goods to customers for $1,000 cash. The cost of the goods to Alexander was $550.
Sept. 29 Collected $670 cash from a customer for goods that will be delivered in October.
Sept. 30 Employees earned $3,240 during September, which Alexander will pay in October.
Required - Make simple income statement for the month of September 2019.