The accountant for Scott Industries prepared the following list of account balances from the company's records for the year ended December 31: Fees Earned $165,000 Cash $30,000 Accounts Receivable 14,000 Selling Expenses 44,000 Equipment 64,000 Scott, capital 27,000 Accounts Payable 12,000 Interest Income 3,000 Salaries and wages expense 40,000 Prepaid Rent 2,000 Income Taxes Payable 5,000 Income Taxes Expense 18,000 Notes Payable 20,000 Rent Expense 20,000 Based on the information for Scott Industries, is it profitable?

Scott Industries is profitable due to a Net income of $46,000.

Explanation:

Their profitability depends on whether they bring in a Net profit or net loss.

Net profit = Fees earned + Interest income - Selling expenses - Salaries and wages expenses - Income tax expense - Rent expense

= 165,000 + 3,000 - 44,000 - 40,000 - 18,000 - 20,000

= $46,000

Scott Industries is profitable due to a Net income of $46,000.

income statement is prepared in order to show the profits and loss of a business. in order to prepare the income statement she should collect all the income and expenses of the product with the cost of production.