Question

Healy Corporation recorded service revenues of $200,000 in 2014, of which $80,000 were on credit and $120,000 were for cash. Moreover, of the $80,000 credit sales for 2014, Healy collected $20,000 cash on those receivables before year-end 2014. The company also paid $40,000 cash for 2014 wages. Its employees also earned another $20,000 in wages for 2014, which were not yet paid at year-end 2014.

Compute the company’s net income for 2014.

Answer 1

$140,000

Step-by-step explanation:

Answer 2

$140,000

Step-by-step explanation:

Computation of the company’s net income for 2014.

Using this formula

Net income=Revenue – Expenses

Let plug in the formula

Net income=$200,000 - $40,000+$20,000

Net income= $140,000

Therefore the company’s net income for 2014 will be $140,000