During the year,Mega,Inc.had revenues of $400,000 of which $310,000 was collected from customers.It also had expenses of $360,000 of which $280,000 was paid.The shareholders were paid $20,000 in dividends.Net income for the year equals ________.
A)$10,000
B)$30,000
C)$40,000
D)$20,000

Question

Quizplus · Accepted Answer

Net income equals revenues minus expenses. 
Therefore, net income = $400,000 - $360,000 = $40,000.

However, shareholders were paid $20,000 in dividends, which reduces the net income to: 
$40,000 - $20,000 = $20,000.

Therefore, the correct answer is C.

During the Year,Mega,Inc