Big John Company Began Business Operations on August 1, 20X5

Essay

Big John Company began business operations on August 1, 20X5. The following transactions occurred during August 20X5:
1. The owner invested $75,000 in the company.
2. Big John Company purchased inventory costing $27,000, of which two- thirds was paid in cash.
3. Equipment costing $22,500 was purchased, of which one- third was paid in cash.
4. Rent of $5,400 was paid for August, September, and October 20X5.
5. Cash sales during the month totaled $12,000. The cost of the inventory sold was $8,100.
6. Credit sales during the month totaled $21,000. The cost of the inventory sold was $15,300.
7. The wages earned by the employees for the month were $9,000, although only $7,800 had been paid as of the end of the month.
8. August's depreciation on the equipment was $600
9. Collections for the credit customers totaled $4,200 during the month.
Given the transactions, determine the net income or loss for Big John Company for the month of August 20X5.