A business has the following transactions:

• The business is started by receiving cash from an investor in exchange for common stock $20,000
• The business purchases supplies on account $500
• The business purchases furniture on accounts $2,000
• The business renders services to various clients on account totaling $9,000
• The business pays salaries $2,000
• The business pays this month’s rent $3,000
• The business pays for the supplies purchased on account.
• The business collects from one of its clients for services rendered earlier in the month $1,500.

Solve for net income using accrual-basis accounting.

Answer rating: 100% (QA)

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