Newton Corporation Entered into the Following Transactions During Its First

question 58

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.
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:

Legal Position

A statement or principle of law that pertains to a particular factual situation, representing an argument or standpoint in legal proceedings.

Principal's Right

The authority or entitlements a principal has in a legal or contractual relationship, especially in relation to an agent acting on their behalf.

Ratify

To formally confirm or approve an act, agreement, or treaty, making it officially valid.

Fiduciary Duty

An obligation to act in the best interest of another party, typically in financial or trust relationships.