The Following Items Are Taken from the Financial Statements of the Postal

question 41

Multiple Choice

The following items are taken from the financial statements of the Postal Service for the year ending December 31, 2015: $$\begin{array} { l r } \text { Accounts payable } & \$ 18,000 \\\text { Accounts receivable } & 11,000 \\\text { Accumulated depreciation - equipment } & 28,000 \\\text { Advertising expense } & 21,000 \\\text { Cash } & 15,000 \\\text { Common stock } & 42,000 \\\text { Dividends } & 14,000 \\\text { Depreciation expense } & 12,000 \\\text { Insurance expense } & 3,000 \\\text { Note payable, due 6/30/16 } & 70,000 \\\text { Prepaid insurance (12-month policy) } & 6,000\end{array}$$ $$\begin{array} { l r } \text { Rent expense } & 17,000 \\\text { Retained earnings (1/1/15) } & 60,000 \\\text { Salaries and wages expense } & 32,000 \\\text { Service revenue } & 133,000 \\\text { Supplies } & 4,000 \\\text { Supplies expense } & 6,000 \\\text { Equipment } & 210,000\end{array}$$ What is the company's net income for the year ending December 31, 2015?

• A) $12,000
• B) $28,000
• C) $42,000
• D) $133,000

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Definitions:

Letter Grade

A score or grade that is assigned to a student's performance in a course, typically expressed as letters (A, B, C, D, F).

Grade Point Value

A numerical value assigned to a grade that measures academic performance, often on a scale like 4.0 for an "A."

Graduated Commission

A commission structure where the rate of commission increases with the level of sales or transactions completed.

Average Rate

The mean value of rates over a specified period or under certain conditions.