Question

Astoria Co. had the following transactions during the month of August:

-Cash received from the bank loan was $20,000
-Dividends of $9,500 were paid to stockholders in cash.
-Revenues earned and received in cash amounted to $33,500
-Expenses incurred and paid were $26,000.
What amount of net income will be reported on an income statement for the month of August?

Answer 1

The net income reported on the income statement for the month of August is $7,500.

Step-by-step explanation:

Net income can be calculated by subtracting the total expenses from the total revenues.

In this case, the total revenues earned and received in cash amounted to $33,500, and the expenses incurred and paid were $26,000. So, the net income for the month of August would be:

$33,500 - $26,000 = $7,500