In a business net assets on 1st January are Rs. 6,000 and on 31st January are Rs. 7,500. If the withdrawals by the owner during January are Rs. 1,000 the net income for January is:

Rs. 1,500
Rs. 2,500
Rs. 500
None of these

The correct answer is: C. Rs. 500

Net income is calculated by taking the difference between the net assets at the beginning of the period and the net assets at the end of the period, and then adding or subtracting any withdrawals or investments made during the period. In this case, the net assets at the beginning of the period are Rs. 6,000, the net assets at the end of the period are Rs. 7,500, and the withdrawals made during the period are Rs. 1,000. Therefore, the net income for January is:

Net income = (7,500 – 6,000) – 1,000 = 500

Option A is incorrect because it is the amount of the withdrawals made during the period, not the net income. Option B is incorrect because it is twice the amount of the net income. Option D is incorrect because it is not a possible value for the net income.