Question

on january 1, 2017, Po Consulting had total assets of $500,000 and total liabilities of $300,000....

on january 1, 2017, Po Consulting had total assets of $500,000 and total liabilities of $300,000. Now, on december 31, 2017, Po has total liabilities of $320,000 and total stockholders equity of $225,000. Po paid dividends of $20,000 during 2005. what was Po's net income (loss) for 2017? a. $45,000 b. -$45,000 c. $25,000 d. -$25,000 e. $0

Homework Answers

Answer #1
Assets = liabilities + Equity
Given:
500,000= 300,000 + 200,000 (balancing figure)
Now on December 31,2017
545000= 320,000 + 225000
Change in Equity
225000-200,000
25,000
so net income = 25000 change + dividend paid 20000
45,000 answer
option a) $45,000 answer
Check
opening Equity 200,000
Add:net income 45,000
245,000
less:dividend paid -20,000
Ending balance 225,000
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