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Ryan Cast started a business, Golf Clubs Inc, buying and re-selling used golf clubs. The...

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Accounting

Ryan Cast started a business, Golf Clubs Inc, buying and re-selling used golf clubs. The business started in May and during its first month of business had the following transactions:

  • Issued 2,000 shares of stock at $40 per share
  • Bought 3,000 golf clubs at $6 per golf club
  • Sold 800 golf clubs on credit for $10 per golf club
  • Sold 700 golf clubs for $10 per golf club
  • Purchased equipment for $12,000 cash. This equipment is estimated to last for 24 months.
  • Purchased $1,000 advertising for May. Golf Clubs Inc will pay for the advertising in June.
  • Golf Clubs Inc declared and paid a $700 dividend to its shareholders.

What is the net income (net loss) for Golf Clubs Inc for the month of May?

A $3,800
B $4,500
C ($4,500)
D $5,500

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