Lankston Company Began the Year by Issuing $120,000 of Common

question 44

Multiple Choice

Lankston Company began the year by issuing $120,000 of common stock for cash.The company recorded revenues of $1,100,000, expenses of $960,000, and paid dividends of $60,000.What was Lankston's net income for the year?

• A)$80,000
• B)$200,000
• C)$140,000
• D)$260,000

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Definitions:

Raw Materials Inventory

The total cost or value of all the basic materials and components that are to be used in the manufacture of a product.

Accounts Payable

Liabilities owed to suppliers or creditors for goods and services received but not yet paid for.

Purchase

The act of buying goods or services, which can include raw materials, equipment, or any item required for business operations.

Overapplied Overhead

Occurs when the allocated manufacturing overhead costs are more than the actual overhead costs incurred.