The Accounts of Odie Company with the Increases or Decreases

question 191

Short Answer

The accounts of Odie Company with the increases or decreases that occurred during the past year are as follows:
$\begin{array}{llcc}\text {Account } &\text { Increase} &\text { Decrease } \\ \hline\text {Cash................................. } &\$425,000\\ \text {Accounts receivable........... } &&\$(5,000)\\ \text { Accounts payable.............. } &&(11,000)\\ \text { Notes payable................... } &16,000\\\end{array}$


Except for net income, an investment of $3,000 by the stockholder, and a dividend of $11,000 by the stockholder, no other items affected the stockholders' equity balance. Using the balance sheet equation, compute net income for the past year.

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Definitions:

Negotiable Instruments

Written contracts (like checks, promissory notes, and bills of exchange) that guarantee the payment of a specific amount of money, either on demand or at a set time.

Actual Authority

The explicit power given to an agent by a principal, allowing the agent to act on the principal's behalf.

Express Authority

Explicit, direct power given to an individual or entity to perform actions or make decisions on behalf of another.

Implied Authority

The power assumed by a person that allows them to act for another, even if not explicitly granted.