Reference no: EM132739917
When the income statement below was prepared for the month ended on June 30th, the XYZ Insurance Agency accountant neglected to take into consideration the following information:
1- A utility bill for 2.000 TL was received on the last day of the month for electric and gas service for the month of June.
2- An insurance salesman sold a life insurance policy to a client for a premium of 28.000 TL. The agency billed the client for the policy and is entitled to a commission of 20%.
3- Supplies on hand at the beginning of the month were 3.000 TL. The agency purchased additional supplies during the month for 2.500 TL in cash and 2.000 TL of supplies were on hand on June 30th.
4- The agency purchased a new car at the beginning of the month for 19.200 TL cash. The car will depreciate 4.800 TL per year.
5- Salaries owed to employees at the end of the month total 5.300 TL. The salaries will be paid on July 5th.
Problem 1: What would be the accurate net income after preparing the correct income statement?
INCOME STATEMENT;
Revenues
permission comission revenues:40,000.00
EXPENSES
salary expenses:6,000.00
advertising expenses:800.00
rent expense:4,200.00
deprecation expense:2,800.00
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