Question

Part! Introduction and Overview (LO 2-2) 2-42. Pre The follo 2-38. Prepare Statements for a Service Company Chuck's Brokerage Service (CBS) is a discount financial services firm offering clients investment advice, trading services, and a variety of mutual funds for investment. Chuck has collected the fol- lowing information for October. Dired Wor! $ Finis 1 Advertising and marketing 2 Brokerage commissions (revenues) 3 Building rent and utilities 4 Fees from clients for investment advice 5 Labor cost for advice 6 Managers' salaries 7 Sales commissions to brokers 8 Training programs for brokers 9 Fees paid to execute trades B 270,000 9,000,000 525,000 4,500,000 2,400,000 900,000 750,000 1,275,000 6,000,000 Direct year w Requi Recor a. C b. c. 10 Required Prepare an income statement for October for CBS. 2-43 The

Answer 1

Chuck's Brokerage Services

Income Statement

For the month of October

Revenue -
Brokerage Commissions	9,000,000
Fees from client for investment advice	4,500,000
Total Revenue		13,500,000
Expenses -
Advertising & marketing	270,000
Building rent & utilities	525,000
Labor cost for advice	2,400,000
Managers salary	900,000
Sales commission to brokers	750,000
Training program for brokers	1,275,000
Fees paid to execute trades	6,000,000
Total expenses		12,120,000
Net income		1,380,000