BACHELOR OF BUSINESS ADMINISTRATION

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BUSINESS ADMINISTRATION

FINANCIAL ACCOUNTING

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Mirah Company compiled the following financial information as of December 31, 2020:Revenues $340, 000Owner’s Capital (1/1/20) 140, 000Equipment 80, 000Expenses 240, 000Cash 90, 000Owner’s Drawings 20, 000Supplies 20, 000Accounts payable 40, 000Accounts receivable 70, 000Mirah’s assets on December 31, 2020 are
A
$190, 000.
B
$260, 000.
C
$360, 000.
D
$480, 000.
Explanation: 

Detailed explanation-1: -Through the income statement, you can witness the inflow of new assets into a business and measure the outflows incurred to produce revenue. Profitability is measured by revenues (what a company is paid for the goods or services it provides) minus expenses (all the costs incurred to run the company) and taxes paid.

Detailed explanation-2: -An income statement is a financial statement that shows you the company’s income and expenditures. It also shows whether a company is making profit or loss for a given period.

Detailed explanation-3: -The Income Statement A company’s income statement provides details on the revenue a company earns and the expenses involved in its operating activities.

Detailed explanation-4: -The statement of retained earnings tells a business owner and others how much cumulative profit the company has available to reinvest in the business.

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