Grid Iron Prep Inc. (GIPI) is a service business incorporated in January of the current year to providepersonal training for athletes aspiring to play college football. The following transactions occurred during themonth ended January 31.1. GIPI issued stock in exchange for $100,000 cash on 1/012. GIPI purchased a gymnasium building and gym equipment on 1/02 for $50,000, 80% of which related tothe gymnasium and 20% to the equipment.3. GIPI paid $260 cash on 1/03 to have the gym equipment refurbished before it could be used4. GIPI provided $4,000 in training on 1/04 and expected collection in February5. GIPI collected $36 000 cash in training fees on 1/10, of which $34,000 was earned in January and$2,000 would be earned in February6. GIPI paid S23 000 of wages and $7,000 in utilities on 1/307. GIPI will depreciate the gymnasium building using the straight-line method over 20 years with a residualvalue of $2,000. Gym equipment will be depreciated using the double-declining-balance method, with anestimated residual value of $2 250 at the end of its four-year useful life. Record depreciation on 1/31equal to one-twelfth the yearly amount.8 GIPI received a bill on 1/31 for $350 for advertising done on 1/31 The bill has not been paidor recorded9 GIPI uses the aging method for estimating doubtful accounts and on 1/31. will record an estimated 3percent of its under 30 day-old accounts as not collectible.10.GIPI's income tax rate is 30% Assunme depreciation for tax is the same amount as depreciation forfinancial reporting purposes GRID IRON PREP INC.Income StatementFor the Month Ended January 31Income before Income Tax ExpenseTrial BalanceStatement of R

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Asked Nov 4, 2019
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Income statement based on info above 

Grid Iron Prep Inc. (GIPI) is a service business incorporated in January of the current year to provide
personal training for athletes aspiring to play college football. The following transactions occurred during the
month ended January 31.
1. GIPI issued stock in exchange for $100,000 cash on 1/01
2. GIPI purchased a gymnasium building and gym equipment on 1/02 for $50,000, 80% of which related to
the gymnasium and 20% to the equipment.
3. GIPI paid $260 cash on 1/03 to have the gym equipment refurbished before it could be used
4. GIPI provided $4,000 in training on 1/04 and expected collection in February
5. GIPI collected $36 000 cash in training fees on 1/10, of which $34,000 was earned in January and
$2,000 would be earned in February
6. GIPI paid S23 000 of wages and $7,000 in utilities on 1/30
7. GIPI will depreciate the gymnasium building using the straight-line method over 20 years with a residual
value of $2,000. Gym equipment will be depreciated using the double-declining-balance method, with an
estimated residual value of $2 250 at the end of its four-year useful life. Record depreciation on 1/31
equal to one-twelfth the yearly amount.
8 GIPI received a bill on 1/31 for $350 for advertising done on 1/31 The bill has not been paid
or recorded
9 GIPI uses the aging method for estimating doubtful accounts and on 1/31. will record an estimated 3
percent of its under 30 day-old accounts as not collectible.
10.GIPI's income tax rate is 30% Assunme depreciation for tax is the same amount as depreciation for
financial reporting purposes
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Grid Iron Prep Inc. (GIPI) is a service business incorporated in January of the current year to provide personal training for athletes aspiring to play college football. The following transactions occurred during the month ended January 31. 1. GIPI issued stock in exchange for $100,000 cash on 1/01 2. GIPI purchased a gymnasium building and gym equipment on 1/02 for $50,000, 80% of which related to the gymnasium and 20% to the equipment. 3. GIPI paid $260 cash on 1/03 to have the gym equipment refurbished before it could be used 4. GIPI provided $4,000 in training on 1/04 and expected collection in February 5. GIPI collected $36 000 cash in training fees on 1/10, of which $34,000 was earned in January and $2,000 would be earned in February 6. GIPI paid S23 000 of wages and $7,000 in utilities on 1/30 7. GIPI will depreciate the gymnasium building using the straight-line method over 20 years with a residual value of $2,000. Gym equipment will be depreciated using the double-declining-balance method, with an estimated residual value of $2 250 at the end of its four-year useful life. Record depreciation on 1/31 equal to one-twelfth the yearly amount. 8 GIPI received a bill on 1/31 for $350 for advertising done on 1/31 The bill has not been paid or recorded 9 GIPI uses the aging method for estimating doubtful accounts and on 1/31. will record an estimated 3 percent of its under 30 day-old accounts as not collectible. 10.GIPI's income tax rate is 30% Assunme depreciation for tax is the same amount as depreciation for financial reporting purposes

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GRID IRON PREP INC.
Income Statement
For the Month Ended January 31
Income before Income Tax Expense
Trial Balance
Statement of R
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GRID IRON PREP INC. Income Statement For the Month Ended January 31 Income before Income Tax Expense Trial Balance Statement of R

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Expert Answer

Step 1

Income statement is as foll...

Income Statement
For the month ended January 31
Amount (S) Amount (S)
$38,000
Training Revenue
Less: Expenses
Wages Expense
Advertising Expense
Bad debt Expense
Utilities Expense
Depreciation Expense
$23,000
$350
$120
$7.000
$31,056
$586
$6,944
$2,083
Net Profit before tax
Less: Income tax @30%
Net Profit after tax
$4,861
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Income Statement For the month ended January 31 Amount (S) Amount (S) $38,000 Training Revenue Less: Expenses Wages Expense Advertising Expense Bad debt Expense Utilities Expense Depreciation Expense $23,000 $350 $120 $7.000 $31,056 $586 $6,944 $2,083 Net Profit before tax Less: Income tax @30% Net Profit after tax $4,861

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