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    seniorlaker88's Avatar
    seniorlaker88 Posts: 1, Reputation: 1
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    Apr 25, 2014, 07:28 AM
    Can net income be assets in excess of liabilities?
    I know that the net income is assets minus liabilities but the exam has four choices and I chose asset in excess of liabilities. Is that correct?
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #2

    Apr 25, 2014, 08:47 AM
    Quote Originally Posted by seniorlaker88
    I know that the net income is assets minus liabilities ..
    No it's not. Net income is income minus cost of goods sold, expenses, and taxes. Assets minus liabailities is equity.
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