Colby Corporation Has Provided the Following Information: • Operating Revenues

question 28

Multiple Choice

Colby Corporation has provided the following information: • Operating revenues from customers were $199,700.
• Operating expenses for the store were $111,000.
• Interest expense was $9,200.
• Gain from sale of plant and equipment was $3,300.
• Dividend payments to Colby's stockholders were $7,700.
• Income tax expense was $36,000.
• Prepaid rent was $5,000.
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What is the amount of Colby's income before income taxes?

• A)$70,100.
• B)$75,100.
• C)$82,800.
• D)$92,000.

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Definitions:

Accrued Expenses

Expenses that have been incurred but not yet paid or recorded in the company's financial statements.

Operating Expenses

Operating Expenses are expenditures that a business incurs through its normal business operations, such as salaries, rent, utilities, and equipment depreciation.

Direct Method

A cash flow statement preparation approach that reports major classes of gross cash receipts and payments.

Cost of Goods Sold

An expense recorded to reflect the cost directly associated with producing the goods sold by a company.