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an you explain step by step how to calculate the net income for The period.

an you explain step by step how to calculate the net income for The period.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Can you explain step by step how to calculate the net income for The period. 

### Accounting Table and Net Income Calculation #### Accounts and Amounts Overview Here is a table listing various financial accounts along with their corresponding amounts: | # | Accounts | Amount | A, L, SE, R, E, or NA | |----|------------------------|---------|-----------------------| | 1 | Wages expense | $43,000 | | | 2 | Common stock | $47,500 | | | 3 | Accounts receivable | $55,500 | | | 4 | Dividends paid | $19,000 | | | 5 | Sales revenue | $267,000| | | 6 | Inventory | $51,500 | | | 7 | Wages payable | $14,000 | | | 8 | Equipment | $175,000| | | 9 | Cost of goods sold | $104,000| | | 10 | Rent expense | $19,000 | | | 11 | Income tax expense | $30,500 | | | 12 | Cash | $62,500 | | | 13 | Retained earnings | $56,500 | | ### Task **B. Calculate net income for the period.** To calculate the net income, use the following formula: \[ \text{Net Income} = \text{Total Revenue} - \text{Total Expenses} \] **Revenue:** - Sales revenue: $267,000 **Expenses:** - Wages expense: $43,000 - Cost of goods sold: $104,000 - Rent expense: $19,000 - Income tax expense: $30,500 Total Expenses: \[ 43,000 + 104,000 + 19,000 + 30,500 = 196,500 \] **Net Income Calculation:** \[ 267,000 - 196,500 = 70,500 \] Thus, the calculated net income for the period is **$70,500**.
Transcribed Image Text:### Accounting Table and Net Income Calculation #### Accounts and Amounts Overview Here is a table listing various financial accounts along with their corresponding amounts: | # | Accounts | Amount | A, L, SE, R, E, or NA | |----|------------------------|---------|-----------------------| | 1 | Wages expense | $43,000 | | | 2 | Common stock | $47,500 | | | 3 | Accounts receivable | $55,500 | | | 4 | Dividends paid | $19,000 | | | 5 | Sales revenue | $267,000| | | 6 | Inventory | $51,500 | | | 7 | Wages payable | $14,000 | | | 8 | Equipment | $175,000| | | 9 | Cost of goods sold | $104,000| | | 10 | Rent expense | $19,000 | | | 11 | Income tax expense | $30,500 | | | 12 | Cash | $62,500 | | | 13 | Retained earnings | $56,500 | | ### Task **B. Calculate net income for the period.** To calculate the net income, use the following formula: \[ \text{Net Income} = \text{Total Revenue} - \text{Total Expenses} \] **Revenue:** - Sales revenue: $267,000 **Expenses:** - Wages expense: $43,000 - Cost of goods sold: $104,000 - Rent expense: $19,000 - Income tax expense: $30,500 Total Expenses: \[ 43,000 + 104,000 + 19,000 + 30,500 = 196,500 \] **Net Income Calculation:** \[ 267,000 - 196,500 = 70,500 \] Thus, the calculated net income for the period is **$70,500**.
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