Nelson Company experienced the following transactions during Year 1, its first year in operation.
1. Issued $6,800 of common stock to stockholders.
2. Provided $3,100 of services on account.
3. Paid $1,800 cash for operating expenses.
4. Collected $2,300 of cash from accounts receivable.
5. Paid a $140 cash dividend to stockholders.
The amount of net income recognized on Nelson Company's Year 1 income statement is .
Multiple Choice:
A. $1,300.
B. $1,160.
C. $940.
D. $800.

Option (A) is correct.

Explanation:

Given that,

Issued common stock to stockholders = $6,800

Provided services on account = $3,100

Paid cash for operating expenses = $1,800

Collected cash from accounts receivable = $2,300

Paid cash dividend to stockholders = $140

Net Income:

= Service revenue - Operating expense

= $3,100 - $1,800

= $1,300

Therefore, the amount of net income recognized on Nelson Company's Year 1 income statement is $1,300.

month 1 start amount =$3287.90 interest=(3287.90x0.0145/12)3.97 total to pay=$3291.81 paid =$1200 balance =$2,091.87

month 2 starting amount= $2,091.87 interest =$25.28 total to pay =$2117.15 paid =$1200 balance $917.15

month 3 starting amount =$917.15 interest =$11.08 total to pay =$928.23 paid =$928.23 balance =$0 total to pay 1200+1200+928.23 = $3328.23 it will take 3 months to pay a total of $3328.23

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