Foxes Service Shop started the year with total assets of $320000 and total liabilities of $240000. During the year the business recorded $630000 in revenues $450000 in expenses and owner drawings of $60000. The net income reported by Foxes Service Shop for the year was
A) $140000.
B) $180000.
C) $200000.
D) $270000.

Question

Quizplus · Accepted Answer

Net income is calculated as revenues minus expenses. Therefore, the net income for Foxes Service Shop is $630,000 (revenues) - $450,000 (expenses) = $180,000.

Foxes Service Shop Started the Year with Total Assets of $320000