net income = total income – total expenses

so before you do anything, you have to determine what categories are what…

ie–utilities and rent would be an expenses, because your company pays money monthly for them

sales, etc. are included in your income, because its cash coming into your company

debt ratio = total debt/total assets

ie–if your companys total assets (cash, inventory, land, etc) totals 50,000…and your company has 60,000 in debt (accounts payable, notes payable, etc)…then your debt ratio is 1.2 : 1—not good…you would always like to see your debt ratio at 1:1 or less…

hope that helped…

That’s an incredibly difficult question to answer in it’s current state. The question is vague on whether or not the Office Supplies, Office Equipment, Trucks, Building and Land are assets carried over from the previous year or expenses for the current year. If they are assets from the previous year carries over then they are irrelevant to net income and they are in there to throw you off. To which your answer would be derived by taking your cash(sales I assume) and Accounts Receivable(sales pending payment) and combine them. By the same token you’d take your Accounts Payable(amount you owe other businesses) and Notes Payable(loans, etc.) and combine them. The difference being your net income/loss. In this case you have a net loss of $106,914 and your debt to income ratio is your debt divided by your income.

If all those things mentioned above are EXPENSES for the year then you’ve got a totally different(and much higher) net loss and debt to income ratio. And I would also say a poorly run company 😛

Hope that helps. Post back if you’d like about whether those are expenses or assets or if the question doesn’t say. If it doesn’t say then you can only give it your best guess and complain to the teacher…

#1. Net Income = Gross Income – Total Expenses

In the given data, Gross Income was not stipulated. In my analysis, Cash and the Account Receivables comprise the Gross Income earned for the year. And the only expense incurred was the Office Supplies. Therefore :

Net Income = 19,324 + 22,947 – 3,381

Net Income = 38,890

#2. Debt Ratio = Total Debts / Total Assets

Total Debts = Accounts Payable + Notes Payable

Total Assets = (Based on the data given) Cash + Accounts Receivable + Office Supplies + Office Equipment + Trucks + Building

Debt Ration = 149,185 / 483,103

CASH IN HAND:-19324$

ASSUMING ALL THE FIGURES ARE IN DOLLARS.

IN ACCOUNTANCY,

EQUITY+CURRENT LIABILITIES=ASSETS+CUREENT ASSESTS

; EQUITY=22947+55462+184883+46137-38165+19324

EQUITY=290588

THEREFORE EQUITY=290588-NOT PAYABLE

=290588-111020

=179568

HENCE BY,THESE

EQUITY ALWAYS STANDS FOR OWMER CAPITAL PLUS CURRENT YEAR PROFIT, AS YOU HAVE NOT MENTIONED THE OWNERS CAPITAL HENCE ASSUMING THAT TOTAL EQUITY AMOUNT IS THE NET INCOME I.E.,

NET INCOME=179568-3381=176187

DEBT RATIO IS THERE OF EQUAL TO

TOTAL DEBT/TOTAL ASSETS

IF TAKE AN EXAMPLE THAT YOUR COMPANY TOTAL DEBT ARE 120000 AND YOUR TOTAL ASSETS ARE 1200000

THEN IT SEEMS NOT GOOD THAT YOUR COMPANY FACE A RATIO OF NEGATIVE INTERMS AS 1:10

SO, IT IS SUGGESTABLE THAT THE DEBT RATIO MUST ALWAYS BE EQUAL TO THE TOTAL ASSETS THAT IS 5:5

RATIO HENCE HOPING THAT THIS WILL HELP YOU !!!!!!!

BEST OF LUCK!!!!!!!!!!!!!!

to get the net income you should create ur income statement, you should have ur total sales, because of these total sales these would be deducted to your expenses then you would get the net income. to get the debt rate,. dept ratio = total liabilities over total assets that the debt ratio…