Exhibit 2-1
Total Assets Total Liabilities
Beginning of the year $300,000 $130,000
End of the year $800,000 $550,000
-Refer to Exhibit 2-1.Determine the net income (or loss),assuming $50,000 of stock was issued and $40,000 of dividends were paid?
A)$70,000
B)$210,000
C)$260,000
D)$10,000

Question

Quizplus · Accepted Answer

Net income = (Total assets - Total liabilities) end - (Total assets - Total liabilities) beginning + Stock issued - Dividends paid= ($800,000 - $550,000) - ($300,000 - $130,000) + $50,000 - $40,000= $250,000 - $170,000 + $50,000 - $40,000= $70,000

Exhibit 2-1 Total Assets Total Liabilities