Revenue on account amounted to $5,000. Cash collections of accounts receivable amounted to $2,300. Expenses for the period were $2,100. The company paid dividends of $450. What was net income for the period

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Business

Miley Coffey

21 November, 08:28

Revenue on account amounted to $5,000. Cash collections of accounts receivable amounted to $2,300. Expenses for the period were $2,100. The company paid dividends of $450. What was net income for the period

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Gunner Ho · Answer 1

In this case we shall assume that the organisation makes sales only on account, as information on cash sales is not given in the problem. Thus going as per this assumption, The total sales amount to $5000, and Expenses amount to $2100. Thus, net income can be found using the below formula:

Net Income = Revenue - Expense

Net Income = $5000-$2100

Net Income=$2900