During Year 5,a company's assets increase by $112,000 and its liabilities increase by $76,000.If no dividends were paid and there were no changes in the amount of common stock issued during the year,net income for Year 5 was:

Question

Quizplus · Accepted Answer

The basic accounting equation can also be thought of as follows:
Change in Assets = Change in Liabilities + Change in Stockholders' Equity
Change in Stockholders' Equity = Change in Assets − Change in Liabilities
= $112,000 − $76,000 = $36,000
Since there were no dividends and no changes in the common stock,the change in stockholders' equity must equal net income.

During Year 5,a Company's Assets Increase by $112,000 and Its