Thursday, October 21, 2010

How do you determine net income using a stockholder's equity statment?

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?How do you determine net income using a stockholder's equity statment?
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.How do you determine net income using a stockholder's equity statment?
The equity statements are not enough. You need the income statements or the balance sheets.
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.

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