In the Current Year,ABC Corporation Had the Following Items of Income,expense,gains,and

question 8

Multiple Choice

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

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

---

Definitions:

Operating Expenses

Regular expenses associated with the operation of a business, such as rent, utilities, and payroll, not directly tied to production.

Cost of Sales

The immediate expenses related to the manufacturing of products sold by a business, encompassing costs for materials and labor.

Cash Receipts

Money received by a business during a particular period, including revenues from sales and other transactions.

Cash Disbursements

Outflows of cash, typically categorized for financial reporting and analysis of a company’s cash outflow activities.