Ask Question
6 May, 15:25

May 1: Prepaid rent for three months, $3,000 May 5: Received and paid electricity bill, $130 May 9: Received cash for meals served to customers, $1,870 May 14: Paid cash for kitchen equipment, $2,990 May 23: Served a banquet on account, $2,520 May 31: Made the adjusting entry for rent (from May 1). May 31: Accrued salary expense, $2,590 May 31: Recorded depreciation for May on kitchen equipment, $740 If Sweet Catering had recorded transactions using the Cash method, how much net income (loss) would they have recorded for the month of May? If there is a loss, enter it with parentheses or a negative sign.

+3
Answers (1)
  1. 6 May, 16:38
    0
    -$850

    Explanation:

    The computation of the net income or loss using the cash method is shown below:

    = Received cash from customers - accrued salary expense - paid electricity bill

    = $1,870 - $2,590 - $130

    = - $850

    As we can see that the total of expenses is more than the revenue generated so it would be the net loss and the same is to be shown in a negative sign

    Hence, the net loss is of - $850
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “May 1: Prepaid rent for three months, $3,000 May 5: Received and paid electricity bill, $130 May 9: Received cash for meals served to ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers