Jerry's Butcher Shop had the following assets and liabilities at the beginning and end of the current year:AssetsLiabilitiesBeginning of the year$114,000$68,000End of the year135,00073,000If there were no stockholder investments in the business and no dividends paid during the year, what was the amount of net income earned by Jerry's Butcher Shop?
What will be an ideal response?
Beginning equity = $114,000 ? $68,000 = $46,000
Ending equity = $135,000 ? $73,000 = $62,000
Increase in equity = $62,000 ? $46,000 = $16,000
Since there were no stock issuances or dividends during the year, the net income is $16,000.
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