Question
On March 31, 2024, the financial records of Yellow Stone Ltd. showed the following: The capital account had a credit balance of $300,000, drawings amounted
On March 31, 2024, the financial records of Yellow Stone Ltd. showed the following: The capital account had a credit balance of $300,000, drawings amounted to $20,000, sales were recorded at $500,000, purchases were $250,000, wages totaled $80,000, utilities expenses were $10,000, rent expense was $20,000, miscellaneous expenses stood at $8,000, and the profit and loss account had a credit of $10,000. Based on these figures, determine the net income for Yellow Stone Ltd.
Requirements:
1.Identify total debits and credits.
2.Calculate net income.
3.Discuss the role of miscellaneous expenses in the overall financial performance.
4.Evaluate the adequacy of the capital account balance.
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