Question

Fun! Inc. had total sales of $ 480,000 in 2014. The total cost of goods sold was $ 400,000 and the administrative and sales costs were $ 100,000. what is the net income of the company in 2014?

Answer 1

Answer:

-$20,000

Explanation:

In the income statement, total revenue and total expenditures are reported.  

If the total income is more than the total expenditure, then the company would gain net income And if the total income is less than the total expenditure, then the company will have a net loss This net income or net loss would be expressed in the statement of retained earning

The computation of the net income is shown below:

= Total sales - total costs of goods sold - administrative and sales costs

= $480,000 - $400,000 - $100,000

= -$20,000