Maynard Company $($B$)$

Maynard Company $($B$)$

Diane Maynard was grateful for the balance sheets that her friend prepared $[$see Case Maynard Company $($A$)].$ In going over the numbers, she remarked, "It's sort of surprising that cash increased by $$31,677,$ but net income was only $$19,635.$ Why was that?"

Her friend replied, "A partial answer to that question is to look at an income statement for June. I think I can find the data I need to prepare one for you."

In addition to the data given in the $($A$)$ case, her friend found a record of cash receipts and disbursements, which is summarized in Exhibit $1.$ She also learned that all accounts payable were to vendors for purchase of merchandise inventory and that cost of sales was $$39,345,$ in June.

Exhibit$-1$

$\backslash$table$[[$Cash Receipts and Disbursements Month of June$],[$Cash Receipts,Cash Disbursements,$],[$Cash sales,$$44,420,$Equipment purchased,$$23,400$