Homework SourseHewlett Packard Corporations balance sheet reported assets o
Hewlett Packard Corporation\'s balance sheet reported assets of $102,000, liabilities of $27,000 and common stock of $24,000 as of December 31, Year 1. If Retained Earnings on the balance sheet as of December 31, Year 2, amount to $66,000 and Hewlett Packard paid a $26,000 dividend during Year 2, then the amount of net income for Year 2 was which of the following?
A. $26,000
B. $15,000
C. $41,000
D. $51,000
Solution
Correct answer is C 41,000
| Year 1 | ||
| Assets | 102000 | |
| Liabilities | -27000 | |
| Common stock | -24000 | |
| Retained earnings year 1 | 51000 | |
| Retained earnings year 2 | 66000 | |
| Add | Dividend paid | 26000 |
| Total | 92000 | |
| Less | Retained earnings year 1 | 51000 |
| Net income year 2 | 41000 | |
