Question

Vaughn Manufacturing is a private camping ground near the Mount Miguel Recreation Area. It has compiled the following financial information as of December 31, 2017. Service revenue (from camping fees) $168,960 Dividends $11,520 Sales revenue (from general store) 32,000 Notes payable 64,000 Accounts payable 14,080 Expenses during 2017 161,280 Cash 10,880 Supplies 7,040 Equipment 145,920 Common stock 51,200 Retained earnings (1/1/2017) 6,400 Determine Vaughn Manufacturing’s net income for 2017. Vaughn Manufacturing’s net income for 2017 $enter a net income amount

Answer 1

The Vaughn Manufacturing’s net income for 2017 is $39,680

Step-by-step explanation:

The computation of the net income is shown below:

In simple form, the net income equals to

= Total revenue - total expenditure

= Service revenue (from camping fees) + Sales revenue (from general store) - Expenses during 2017

= $168,960 + $32,000 - $161,280

= $39,680

The other items which are mentioned in the question are irrelevant. Therefore, these are ignored for the computation part