Question

Ivan's, Incorporated, paid 484 in dividends and587 in interest this past year. The common stock increased by 197 and retained earnings decreased by123. What is the net income for the year?

Answer 1

The net income for the year is -$997. This means that the company had a net loss of $997 for the year.

Step-by-step explanation:

To find the net income for the year, we need to calculate the total profits. We are given that the common stock increased by $197 and retained earnings decreased by $123. We are also given that dividends paid were $484 and interest paid was $587. Since the common stock increased, we can assume that the retained earnings decreased due to dividends. Therefore, the net income for the year can be calculated as follows:

1. Net income = Total profits - Dividends - Interest
2. Net income = (Common stock increase + Retained earnings decrease) - Dividends - Interest
3. Net income = ($197 - $123) - $484 - $587
4. Net income = $74 - $484 - $587
5. Net income = $-997

The net income for the year is -$997. This means that the company had a net loss of $997 for the year.