Question 1

The beginning balance in total assets is $100,000 and total liability $30,000. The ending balance in total assets is $120,000 and total liability $20,000.

Which of the following is possible?

A) Net loss of $10,000, no changes in the other Owners' Equity accounts.

B) Net income (or profit) of $10,000, no changes in the other Owners' Equity accounts.

C) Net income (or profit): $40,000; dividends paid: $10,000; no changes in other Owners' Equity accounts.

D) Net loss of $30,000, no changes in the other Owners' Equity accounts.