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The changes in account balances for Elder Company for 2021 are as follows:
Assets $ 480,000 debit
Common stock 250,000 credit
Liabilities 160,000 credit
Paid-in capital—excess of par 30,000 credit

Assuming the only changes in retained earnings in 2021 were for net income and a $50,000 dividend, what was net income for 2021?

Respuesta :

The changes in account balances for Elder Company for 2021 are net income will be $160000

We have given debt common stock = $680000

Credit liabilities = 350000

Credit paid in capital = 190000

And an excess of par 30,000 credit Assuming the only changes in retained earnings

So 680000 = 350000+190000+30000+ retained earning

What is the net income?

Net income is an entity's income minus the cost of goods sold, expenses, depreciation and amortization, interest, and taxes for an accounting period.

So retained earning = $110000

Dividend paid = $50000

So Net income = dividend paid + retained earning

Net income = $110000+$50000

Net income = $160000

So option (c) will be the correct answer.

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