Following Is a List of Account Balances of Wilson Mowing

question 121

Multiple Choice

Following is a list of account balances of Wilson Mowing Service as of December 31 of the first year of operation: Calculate the net income.

• A)$21,200
• B)$11,900
• C)$12,200
• D)$24,100

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Definitions:

Owner's Capital

The amount of equity a proprietor has in the business, representing the difference between the business's assets and liabilities.

Prepaid Expenses

Expenses paid in advance for goods or services to be received in the future.

Adjusting Journal Entry

An accounting entry made at the end of an accounting period to allocate income and expenditures to the appropriate period.

Wages Expense

Costs incurred by a company for the payment of wages to its employees, typically reported on the income statement.