Question

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?

Answer 1

Answer:

Explanation:

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 .