Expense recognition strictly requires the matching expenses against revenue.

Revenue result in increase in equity and therefore has a credit normal balance.

This is the total amount of income that the company was able to generate from providing services to customers.

ABM Company generated revenues amounting to Php 200,000. Expenses for the year totaled Php 156,000. How much is the company’s net income for the year?

The Statement of Income also called profit and loss statement, presents an entity’s results of operation for a period of time.

Gains are generated from the primary operations of the business

The normal balance of revenue account is debit.

These is also called temporary accounts because at the end of the accounting period, balances under these accounts are transferred to the capital account.

At the end of the first month of operations for Juan’s Service Company, the business had the following accounts: Cash, Php19,000; Prepaid Rent, Php500; Equipment, Php5,000 and Accounts Payable Php2,000. By the end of the month, Jackson's had earned Php20,000 of Revenues, Php1,000 of Utilities Expenses and Php1,500 of Salaries Expenses. Calculate the net income to be reported by the company for this first month.