Asked by Jackson Hooper on May 01, 2024
Verified
Which of the following combinations results does not result in the same amount of net income reported on the income statement?
A) Total revenues of $80,000 and total expenses of $60,000.
B) Total revenues of $170,000 and total expenses of $150,000.
C) Total revenues of $60,000 and total expenses of $40,000.
D) Total revenues of $70,000 and total expenses of $60,000.
E) Total revenues of $40,000 and total expenses of $20,000.
Income Statement
An account that outlines a business's financial transactions, such as earnings, costs, and overall profit, for a defined timeframe.
Total Revenues
Total revenues refer to the full amount of income generated by a company from its business activities, including sales of goods or services, before any expenses are subtracted.
Net Income
The end profit of a company once every expense, tax, and cost has been taken out of its total income.
- Determine the accounts that impact the computation of net income and comprehend the effect of various transactions on it.
Verified Answer
ZK
Zybrea KnightMay 06, 2024
Final Answer :
D
Explanation :
Net income is calculated as total revenues minus total expenses. For options A, B, C, and E, the net income is $20,000 ($80,000 - $60,000, $170,000 - $150,000, $60,000 - $40,000, and $40,000 - $20,000, respectively). However, for option D, the net income is $10,000 ($70,000 - $60,000), which is different from the others.
Learning Objectives
- Determine the accounts that impact the computation of net income and comprehend the effect of various transactions on it.