Question

The financial records for Harold Corporation included the following information: Accounts receivable, $60,000Accounts payable, $20,000Cash, $25,000Common stock, $10,000 Dividends, $10,000Insurance expense, $5,000Salaries and wages expense, $50,000Sales revenue, $120,000Based on this information, how much was its net income?

Answer 1

Answer: Net Income = $65000

Explanation:

Given that,

Accounts receivable = $60,000

Accounts payable = $20,000

Cash = $25,000

Common stock = $10,000

Insurance expense = $5,000

Salaries and wages expense = $50,000

Sales revenue = $120,000

Net Income = Sales revenue - Salaries and wages expense - Insurance expense

= $120,000 - $50,000 - $5,000

= $65,000