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Carla Vista Co. was organized on April 1, 2021, by Trudy Crawford. Trudy is a good manager but a poor accountant. From the trial balance prepared by a part-time bookkeeper, Trudy prepared the following income statement for the quarter that ended March 31, 2022 Carla Vista Co. Income Statement For the Quarter Ended March 31, 2022 Revenues Rent revenue $ 83,000 Operating expenses Advertising expense $ 4,000 Salaries and wages expense 28,000 Utilities expense 1,200 Depreciation expense 840 Maintenance and repairs expense 2,800 Total operating expenses 36,840 Net income $ 46,160 Trudy knew that something was wrong with the statement because net income had never exceeded $ 21,000 in any one quarter. Knowing that you are an experienced accountant, she asks you to review the income statement and other data. You first look at the trial balance. In addition to the account balances reported in the income statement, the ledger contains these selected balances at March 31, 2022. Supplies $ 4,500 Prepaid Insurance 7,200 Notes Payable 24,000 You then make inquiries and discover the following. 1. Rent revenue includes advanced rentals for summer-month occupancy, $ 20,500. 2. There were $690 of supplies on hand at March 31. 3. Prepaid insurance resulted from the payment of a 1-year policy on January 1, 2022. 4. The mail on April 1, 2022, brought the following bills: advertising for week of March 24, $ 140; repairs made March 10, $ 1,050; and utilities $220. 5. Wage expense totals $ 310 per day. At March 31, 3 days' wages have been incurred but not paid. 6. The note payable is a 3-month, 7% note dated January 1, 2022. (a) Prepare a correct income statement for the quarter ended March 31, 2022. Carla Vista Co. Income Statement For the Quarter Ended March 31, 2022 V Revenues Rent Revenue $ 62,500 Expenses Advertising Expense $ Salaries and Wages Expense Utilities Expense Depreciation Expense Maintenance and Repairs Expense Insurance Expense Supplies Expense Interest Expense Total Expenses Net Income /(Loss) $

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