The following table contains financial information for Trumpeter Inc. before closing entries:

The following table contains financial information for Trumpeter Inc. before closing entries:

Cash $ 12,000

Supplies 4,500

Prepaid Rent 2,000

Salaries Expense 4,500

Equipment 65,000

Service Revenue 30,000

Miscellaneous Expense 20,000

Dividends 3,000

Accounts Payable 5,000

Common Stock 68,000

Retained Earnings 8,000

What is the amount of Trumpeter's total stockholders' equity?

A) $5,000.

B) $78,500.

C) $68,500.

D) $83,500.

Answer: B

The following table contains financial information for Trumpeter Inc. before closing entries:

Cash $ 12,000

Supplies 4,500

Prepaid Rent 2,000

Salaries Expense 4,500

Equipment 65,000

Service Revenue 30,000

Miscellaneous Expense 20,000

Dividends 3,000

Accounts Payable 5,000

Common Stock 68,000

Retained Earnings 8,000

What is the amount of Trumpeter's total liabilities?

A) $5,000.

B) $78,500.

C) $68,500.

D) $83,500.

Answer: A

The following table contains financial information for Trumpeter Inc. before closing entries: Cash $ 12,000

The following table contains financial information for Trumpeter Inc. before closing entries:

Cash $ 12,000

Supplies 4,500

Prepaid Rent 2,000

Salaries Expense 4,500

Equipment 65,000

Service Revenue 30,000

Miscellaneous Expense 20,000

Dividends 3,000

Accounts Payable 5,000

Common Stock 68,000

Retained Earnings 8,000

What is Trumpeter's net income?

A) $3,500.

B) $2,500.

C) $5,000.

D) $5,500.

Answer: D

Which of the following best describes the information reported in the income statement?

A) The portion of profits paid in cash to stockholders.

B) The current resources available to pay current obligations.

C) The amount recognized from providing goods and services to customers compared to the cost of doing so.

D) The extent to which cash inflows exceed cash outflows.

Answer: C

Which of the following is true about an income statement?

A) It reports activity for a period of time.

B) It does not include dividends paid.

C) It reports revenues and expenses.

D) All of the other answers are true.

Answer: D