Newton Corporation Entered into the Following Transactions During Its First

question 125

Multiple Choice

Newton Corporation entered into the following transactions during its first year of operations.(Assume all transactions involve cash.)
1) Acquired $2,000 of capital from the owners.
2) Purchased $600 of direct raw materials.
3) Used $400 of these direct raw materials in the production process.
4) Paid production workers $800 cash.
5) Paid $400 for manufacturing overhead (applied and actual overhead are the same) .
6) Started and completed 200 units of inventory.
7) Sold 50 units at a price of $12 each.
8) Paid $80 for selling and administrative expenses.
The amount of net income for the year was:

• A)$100.
• B)$75.
• C)$50.
• D)$120.

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Definitions:

Top Executives

Individuals holding senior management positions within a company, responsible for overseeing its operations and strategic direction.

Stewardship Function

Stewardship Function refers to the responsibility of managing and protecting the assets and resources of an organization, ensuring their efficient and effective use.

Faithful Representation

A principle of accounting that requires financial statements to accurately reflect the economic events that they represent.

Executive Compensation

The financial payments and other benefits provided to high-level management in a corporation, which may include salary, bonuses, stock options, and other perks.