Makar Corporation Reported Net Income Before Extraordinary Items and Taxes

question 78

Multiple Choice

Makar Corporation reported net income before extraordinary items and taxes of $200,000 for the year 2010. During 2010, the average number of common shares outstanding was 35,000. Basic net earnings per share for 2010 are reported to be only $2.00. Makar's income tax rate is 30%. How much was Makar's extraordinary gain or loss (before tax) from a major earthquake? The earthquake was the only item that was reported net of tax in the income statement for 2010.

• A) $70,000.
• B) $100,000.
• C) $130,000.
• D) none of the above

Explain the principles of peak-load pricing and its application.

Calculate optimal pricing and tariffs based on consumer demand and marginal cost.

Evaluate the effectiveness of intertemporal price discrimination strategies.

Distinguish between the different degrees of price discrimination and their application.

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Definitions:

Inventory Turnover

A ratio showing how many times a company has sold and replaced inventory over a certain period of time, indicating the efficiency of inventory management.

Debt Ratio

A financial ratio that measures the proportion of a company's total debt to its total assets, indicating the leverage and financial risk of the company.

Days' Sales in Inventory

A financial metric that shows the average number of days a company takes to turn its inventory into sales.

Dividend Yield

A ratio demonstrating how much a company disburses in dividends annually in comparison to its stock price.