During 2010, Yoder Enterprises generated revenues of $60,000. The company's expenses were as follows: cost of goods sold of $30,000, operating expenses of $12,000 and a loss on the sale of equipment of $2,000.
Yoder's net income is
A) $60,000.
B) $30,000.
C) $18,000.
D) $16,000.

Question

Quizplus · Accepted Answer

Net income is calculated as total revenues minus total expenses. Yoder's total expenses are $30,000 (cost of goods sold) + $12,000 (operating expenses) + $2,000 (loss on sale of equipment) = $44,000. Therefore, net income is $60,000 (revenues) - $44,000 (expenses) = $16,000.

During 2010, Yoder Enterprises Generated Revenues of $60,000