How do you determine net income using a stockholder’s equity statment?
November 28, 2008
surfergirrl asked:
I need to determine a company’s net income for 2009. I have 2008 and 2009’s stockholder’s equity statement. How do I determine net income?
I need to determine a company’s net income for 2009. I have 2008 and 2009’s stockholder’s equity statement. How do I determine net income?
November 30th, 2008 at 2:56 pm
The equity statements are not enough. You need the income statements or the balance sheets.
December 3rd, 2008 at 12:21 am
Subtract Retained Earnings in 2008 from the 2009 statement and add back in any dividends they paid in 2009. If you end up with a negative answer they had a loss.
December 5th, 2008 at 2:54 pm
If there has been no other entry that affects stockholder’s equity, then the change between the two year balances reflects the net income. If on the other hand the 2009 value is lower than the the 2008 value, then the company experienced a net loss.