The balance of stockholders' equity at the beginning of the year and the end of the year was $ 60 comma 000 and $ 67 comma 000 , respectively. The company issued no common stock during the year. Dividends were $ 22 comma 000. What was the net income or loss for the year?

Question

Joseph Lynch

Business

14 November, 01:30

The balance of stockholders' equity at the beginning of the year and the end of the year was $ 60 comma 000 and $ 67 comma 000 , respectively. The company issued no common stock during the year. Dividends were $ 22 comma 000. What was the net income or loss for the year?

+3

Answers (1)

Know the Answer?

Keagan Bass · Answer 1

Income / (loss) for the year = Equity balance at the end + dividend paid - equity balance at the beginning

=$67,000+22,000-$60,000

=$29,000

Since no additional common stock was issued during the year, $29,000 represents income earned during the year before dividend is paid. After dividend of $22,000 has been paid, the balance of $7,000 profit will be added to retained earnings.