Jacob started a business with the following transactions: 1. Invested $20,000 into the business. 2. Purchased supplies worth $2,000 on account. 3. Sold goods for $10,000; these goods cost $6,000. 4. Paid salaries of $1,000. What is Jacob's net income after these transactions? A) $3,000 B) $4,000 C) $2,000 D) $1,000

CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN:9780357110362
Author:Murphy
Publisher:Murphy
Chapter3: Income Sources
Section: Chapter Questions
Problem 79P
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Jacob started a business with the following transactions:
1. Invested $20,000 into the business.
2. Purchased supplies worth $2,000 on account.
3. Sold goods for $10,000; these goods cost $6,000.
4. Paid salaries of $1,000.
What is Jacob's net income after these transactions?
A) $3,000
B) $4,000
C) $2,000
D) $1,000
Transcribed Image Text:Jacob started a business with the following transactions: 1. Invested $20,000 into the business. 2. Purchased supplies worth $2,000 on account. 3. Sold goods for $10,000; these goods cost $6,000. 4. Paid salaries of $1,000. What is Jacob's net income after these transactions? A) $3,000 B) $4,000 C) $2,000 D) $1,000
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