Understanding Net Income Calculation

Medium Financial Statements Income Statement

ABC Technologies, Inc. has prepared its income statement for the fiscal year ended December 31, 2023. The company reported total revenues of $2,500,000 and total expenses of $1,800,000. Apart from the standard revenue and expenses, ABC had an extraordinary gain of $200,000 due to the sale of a subsidiary.

Based on the information provided, which of the following items will appear on ABC Technologies' income statement and how will it impact the calculation of net income for the period?

Total revenues of $2,500,000, total expenses of $1,800,000, leading to a net income of $700,000 including extraordinary gains.

Total revenues of $2,300,000, total expenses of $1,800,000, leading to a net income of $500,000.

Total revenues of $2,500,000, total expenses of $1,800,000, leading to a net income of $900,000 excluding extraordinary gains.

Hint

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