Problem 1. (Computation of Net Income) Presented below are changes in all the account balances of Jackson Furniture Co. during the current year, except for retained earnings.
Increase (Decrease) Increase (Decrease)
Cash $ 69,000 Accounts Payable $(51,000)
Accounts Receivable (net) 45,000 Bonds Payable 82,000
Inventory 127,000 Common Stock 125,000
Investments (47,000) Additional Paid-in Capital 13,000
Compute the net income for the current year, assuming that there were no entries in the Retained Earnings account except for net income and a dividend declaration of $24,000 which was paid in the current year.
Problem 2. (Income Statement Items) Presented below are certain account balances of Wade Products Co.
Rental revenue $ 6,500 Sales discounts $ 7,800
Interest expense 12,700 Selling expenses 99,400
Beginning retained earnings 114,400 Sales 400,000
Ending retained earnings 134,000 Income tax 26,600
Dividend revenue 71,000 Cost of goods sold 184,400
Sales returns 12,400 Administrative expenses 82,500
From the foregoing, compute the following: (a) total net revenue, (b) net income, (c) dividends declared during the current year.