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 no stock was issued and no dividends were paid?
A)$420,000
B)$250,000
C)$80,000
D)$170,000

Question

Quizplus · Accepted Answer

Net income (or loss) can be calculated by subtracting the beginning total liabilities from the ending total liabilities (550,000 - 130,000) and then subtracting this result from the ending total assets (800,000 - 420,000). Therefore, the net income (or loss) would be $80,000.

Exhibit 2-1 Total Assets Total Liabilities