Reference no: EM132458280

Problem - Sweet Catering completed the following selected transactions during May 2016:

May 1: Prepaid rent for three months, $2,700.

May 5: Received and paid electricity bill, $60.

May 9: Received cash for meals served to customers, $2,570.

May 14: Paid cash for kitchen equipment, $3,750.

May 23: Served a banquet on account, $1,800.

May 31: Made the adjusting entry for rent (from May 1).

May 31: Accrued salary expense, $2,210.

May 31: Recorded depreciation for May on kitchen equipment, $410.

Required - Find the following:

1. If Sweet Catering had recorded transactions using the Cash method, how much net income (loss) would they have recorded for the month of May? If there is a loss, enter it with parentheses or a negative sign.

2. If Sweet Catering had recorded transactions using the Accrual method, how much net income (loss) would they have recorded for the month of May? If there is a loss, enter it with parentheses or a negative sign.