Problem
Peter's Curling Inc. operates several curling centres (for games and equipment sales). The following transactions occurred in October of the current year:
• Peter's collected $13,000 from customers for games played in October (example).
• Peter's sold $7,000 in curling equipment inventory; received $3,000 in cash and the rest on account; cost of sales is $4,200.
• Peter's received $2,500 from customers on account who purchased merchandise in September.
• The curling league gave Peter's a deposit of $2,600 for the upcoming fall season.
• Peter's paid $1,900 for the September electricity bill and received the October bill for $2,200 to be paid in November.
• Peter's paid $4,700 to employees for work in October.
• Peter's purchased $1,800 in insurance for coverage from October 1 to December 31.
• Peter's paid $1,400 to plumbers for repairing a broken pipe in the washrooms.
Task
Prepare a statement of earnings for Peter's Curling Inc. for the month of October 2020. Use an income tax rate of 40 percent.