Question

The balance of stockholder's equity at the beginning of the year and the end of the year was 70,000 and 60,000, respectively. The company issued no common stock during the year. Dividends were 22,000. What was the net income or loss for the year?

Answer 1

Answer: 12,000

Explanation:

Given that,

Stockholder's equity at the beginning of the year = 70,000

Stockholder's equity at the end of the year = 60,000

Dividends = 22,000

Net Income = Ending Balance + Dividends - Beginning Balance

                    = 60,000 + 22,000 - 70,000

                    = 12,000

Therefore, the net income for the year was 12,000.