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The income statement shown below was prepared and sent by Jenna Preston, the owner of Preston Gifts, to several of her creditors. The business is a sole proprietorship that sells miscellaneous gifts. An accountant for one of the creditors looked over the income statement and found that it did not conform to generally accepted accounting principles.

PRESTON GIFTS Income Statement Year Ended December 31, 20X1
Cash Collected from Customers				$	121,000
Cost of Goods Sold
Merchandise Inventory, Jan. 1	$	31,000
Payments to Suppliers		71,000
		102,000
Less: Merchandise Inventory, Dec. 31		19,000
Cost of Goods Sold					83,000
Gross Profit on Sales					38,000
Operating Expenses
Automobile Expense		12,000
Salaries of Employees		32,200
Payroll Taxes Expense		2,700
Rent Expense		11,700
Advertising Expense		1,200
Utilities Expense		2,800
Total Expenses					62,600
Net Loss				$	(24,600	)

Additional information provided by owner:

1. All sales were for cash.
2. The beginning and ending merchandise inventories were valued at their estimated selling price. The actual cost of the ending inventory is estimated to be $13,000. The actual cost of the beginning inventory is estimated to be $21,000.
3. On December 31, 20X1, suppliers of merchandise are owed $12,000. On January 1, 20X1, they were owed $14,500.
4. The owner paid her personal monthly car lease of $1,000 per month using business funds and charged this amount to the Automobile Expense account.
5. A check for $810 to cover the December rent on the owners personal apartment was issued from the firms bank account. This amount was charged to Rent Expense.

Write an income statement from the information above.

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