Consider a firm Theta that spends $60 to produce goods in year 1. In year 2...

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Consider a firm Theta that spends $60 to produce goods in year 1. In year 2...

Consider a firm Theta that spends $60 to produce goods in year 1. In year 2 it sells these goods for $100, but its customers pay their bills with a delay, therefore the payment is not received until year 3. What's the amount of net income recorded on the income statement for each year?

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Answer 1

Answer #1

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Net income year 1 = 0

net income year 2 = 40

net income year 3 = 0

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Answer 2

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