In the Current Year, ABC Corporation Had the Following Items

question 135

Multiple Choice

In the current year, ABC Corporation had the following items of income, expense, gains, and losses: $\begin{array}{|l|r|}\hline\text { Sales } & \$ 500,000 \\\hline \text { Cost of sales } & 270,000 \\\hline \text { Operating expenses } & 100,000 \\\hline \text { Interest on savings account } & 14,000 \\\hline \text { Gain on sale of AT\&Tstock } & 6,000 \\\hline \text { Loss on sale of IBM stock } & 15,000\\\hline\end{array}$ What is taxable income for the year?

• A) $135,000
• B) $141,000
• C) $144,000
• D) $150,000

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Definitions:

Machine Hours

A measure of the actual operating time of a machine or piece of equipment, used for costing and manufacturing planning purposes.

Direct Labor

The cost of wages for employees directly involved in the manufacturing or production of goods or services.

Work in Process Inventory

Represents the cost attributed to partially completed goods, which are still being manufactured.

Payroll Payable

Liabilities for wages owed but not yet paid to employees for work performed within a defined period.