During the year 2011, Diego Company earned revenues of $45,000, had expenses of $25,000, purchased assets with a cost of $5,000 and paid dividends of $3,000.Net income for the year is

Question

Quizplus · Accepted Answer

Net income is calculated as revenues minus expenses. Therefore, Diego Company's net income for the year is $45,000 (revenues) - $25,000 (expenses) = $20,000. The purchase of assets and payment of dividends do not affect the net income calculation.

During the Year 2011, Diego Company Earned Revenues of $45,000