How do I find the net income for this company ,with this information?
Beginning of year
Total Assets were:$810,000
Total liabilites were:$324,000
End of year
Total Assets were:$1,296,000
Total liabiltes were:$540,00
Capital stock of $162,000 was issued
dividends of $72,000were paid
To find the net income for the company, you need to use the following formula:
Net Income = (End of Year Total Assets - Beginning of Year Total Assets) - (End of Year Total Liabilities - Beginning of Year Total Liabilities) + Capital Stock Issued - Dividends Paid
1. Calculate the change in Total Assets:
End of Year Total Assets - Beginning of Year Total Assets = $1,296,000 - $810,000 = $486,000
2. Calculate the change in Total Liabilities:
End of Year Total Liabilities - Beginning of Year Total Liabilities = $540,000 - $324,000 = $216,000
3. Calculate the net increase in Capital Stock:
Capital Stock Issued = $162,000
4. Calculate the dividends paid:
Dividends Paid = $72,000
5. Plug the values into the formula to find the net income:
Net Income = ($486,000 - $216,000) + $162,000 - $72,000 = $360,000
Therefore, the net income for the company is $360,000.