Question

"Revenues for the year totaled $162,000 and expenses totaled $174,000. The stockholders purchased $15,000 of common stock and were paid $6,000 in dividends during the year. What was the net income or net loss for the year?"

Answer 1

Answer:

The correct answer is Loss = $12,000.

Explanation:

According to the scenario, the given data are as follows:

Total revenue = $162,000

Total expenses = $174,000

So, we can calculate the net income of loss by using the following formula:

Net income or loss = Total revenue - Total expenses

By putting the value, we get

= $162,000 - $174,000

= -$12,000

Here negative sign indicates the loss.

So, Net loss = $12,000.