The December 31, 2018, balance sheet for Deen Company showed total stockholders’

Question

The December 31, 2018, balance sheet for Deen Company showed total stockholders’ equity of $72,500. Total stockholders’ equity increased by $23,460 between December 31, 2018, and December 31, 2019. During 2019 Deen Company acquired $20,000 cash from the issue of common stock. The Company paid a $7,500 cash dividend to the stockholders during 2019.

Required

Determine the amount of net income or loss Deen reported on its 2019 income statement. (Hint: Remember that stock issues, net income, and dividends all change total stockholders’ equity.)

Typewritten answers only, please, no handwritten answers. Thank you.

Explanation / Answer

Increase in stockholders equity 23,460 Less:Issue of common stock - 20,000 3,460 Add:Cash dividend paid 7,500 Net income 2019 Deen reported 10,960

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