Answer:
The net income for the month of April is $70,000
Explanation:
By using the Accounting equation, we will determine the ending and beginning retained earnings is as:
The accounting equation is
Assets = Liabilities + Shareholder's equity
Assets = Liabilities + (Common Stock + Retained Earnings [RE] )
$116,000 = $47,000 +($14,000 + RE)
RE = $116,000 - $47,000 - $14,000
Beginning RE = $55,000
Computing ending RE as:
Ending RE = Assets - Liabilities - Common Stock
= $192,000 - $53,000 - $14,000
= $125,000
Now computing the Net Income as:
Beginning RE + Net Income (NI) = Ending Inventory
$55,000 + NI = $125,000
NI = $125,000 - $55,000
NI = 70,000
