During 2018, Its First Year of Operations, Neko's Bakery Had

question 33

Multiple Choice

During 2018, its first year of operations, Neko's Bakery had revenues of $60,000 and expenses of $35,000. The business paid dividends of $20,000. What is the amount of stockholders' equity at December 31, 2018?

• A) $0
• B) $5,000 credit
• C) $25,000 credit
• D) $20,000 debit

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Definitions:

Break-Even Point

The point at which the amount produced or sold results in total income matching total costs, leading to neither a profit nor a loss.

Net Loss

The amount by which expenses exceed revenues over a specific period, indicating a negative financial performance.

Target Profits

The specific amount of net income a company aims to achieve within a certain time frame.