Answer and Explanation:
The computation of the net income or loss for the year is shown below:
As we know that
Ending retained earnings balance = beginning retained earning balance + net income or net loss - dividend paid
$35,000 = $30,000 + net income or net loss - $13,000
$35,000 = $17,000 + net income or net loss
So, the net income or net loss is $18,000
This is an answer but the same is not provided in the given options
With fixed incomes, because they will find that the money that they have, when inflation occurs, won't be as worth as much before. The people with rising incomes will rise along with the inflation rates, so they will not feel the effect.
For a loss to be shown on his tax return, the total expenses (prices of goods, supplies, transportation and so on) must be larger than the sale or revenue.
Since he's always showing profit, this means that his revenue his more.
Scott may be including some illegitimate factors (factors that are not usually included in the calculation) in his calculations. These factors may lead to hypothetical loss for him.
Answer:
A) They would be indifferent, as Sally's income net of costs equals $25,000.
Explanation:
Sally's economic profit = accounting profit - opportunity costs
- accounting profit = $12,000
- opportunity costs = $25,000 - $15,000 in lost salaries + $2,000 (lost investment revenue) = $12,000
economic profit = $12,000 - $12,000 = $0
Since the economic profit is $0, Sally should be indifferent between running her own business or working for someone else.
