Abbie marson is the sole owner and operator of great plains company. as of the end of its accounting period, december 31, year 1, great plains company has assets of $908,100 and liabilities of $267,845. during year 2, marson invested an additional $28,658 and withdrew $25,871 from the business. what is the amount of net income during year 2, assuming that as of december 31, year 2, assets were $980,279 and liabilities were $233,892?
a. $33,953.
b. $103,345.
c. $25,871.
d. $72,179.

b. $103,345

Explanation:

Assets = Liabilities + Owner's Equity

Owner's Equity (Year 1) = $908,100 - $267,845

                                       = $640,255

Owner's Equity (Year 2) = $980,279 - $233,892

                                        = $746,387

increase in Owner's Equity = Owner's Equity (Year 2) - Owner's Equity (Year 1)  

                                             = $746,387 - $640,255

                                             = $106,132

Net income during Year 2 = Increase in Owner's Equity - Additional investment + Withdrawals

                                            = $106,132 - $28,658 + $25,871

                                            = $103,345

Therefore, the amount of net income during Year 2 is $103.345.

a. primarily outdoors, responding to emergencies and protecting people.

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