The adjusted trial balance of Parsons Company at December 31, 2020, includes the following accounts: Common Stock $15,600, Dividends $7,000, Service Revenue $37,000, Salaries and Wages Expense $16,000, Insurance Expense $2,000, Rent Expense $4,000, Supplies Expense $1,500, and Depreciation Expense $1,300. Required:
Prepare an income statement for the year.

$12,200

Explanation:

Preparation of an income statement for the year.

PARSONS COMPANY Income Statement

For the year ended December 31,2020

Service Revenue $37,000

Expenses:

Salaries and wages$16,000

Insurance Expense$2,000

Rent Expense$4,000

Supplies Expense$1,500

Depreciation Expense$1,300

Total Expenses $24,800

Net Income $12,200

($37,000-$24,800)

Therefore income statement for the year is $12,200

explanation: doctrine of respondeat superior is a legal doctrine that is commonly used in tort. this principle makes an employer or principal legally responsible for the wrongful acts done by an employee or agent, if such acts occur within the scope of the employment or agency.

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