Answer:
There are two unrelated sub-question in this question.
First question from start to the question: "How much was Bravo Company's 20x6 net income? le at year-end": The answer is $2,000.
Second question start from the end of the first question to the end. The question is: How much income for the year?": The answer is: $63,000.
Step-by-step explanation:
* First question: Assume Bravo Company applies accrual accounting, we have: Bravo Company's 20x6 net income = Revenue for 20x6 - Expenses for 20x6 ( ignore cash flow because accrual accounting recorded revenues/expenses when they are earned/incurred rather than cash is collected/paid) = 5,000 - 3,000 = $2,000.
* Second question: We have income for the year = Ending Balance of equity - Beginning balance of equity - Additional issuance of equity ( as there is no information on dividend distribution or opening balance of retained earnings) = 195,000 - 120,000 - 12,000 = $63,000.