Answer:
See explanation below
Explanation:
• Computation of Net income/loss recorded for the month of May, using accrual method
Received cash for meals served to customers $3,510
+ Served a banquet on account $1,520
Total revenue $5,030
Less: expenses
(-) rent expense for May ($2,400/3) ($800)
(-) received and paid electricity bill ($90)
(-) accrued salary expense ($2,630)
(-) depreciation expense for May on kitchen equipment ($560)
Net income (revenue - expenses) $950
• Computation of Net income/loss recorded for the month of May, using cash method
Received cash for meals served to customers $3,510
(-) prepaid rent for three months ($2,400)
(-) received and paid electricity bill ($90)
(-) paid cash for kitchen equipment ($3,730)
Net loss ($2,710)
