Selected Data for Kris Corporation's Comparative Balance Sheets for Year

question 43

Multiple Choice

Selected data for Kris Corporation's comparative balance sheets for Year 1 and Year 2 are as follows:
$\begin{array}{lrr}\text { Assets } & \text { Year 1 } & \text { Year 2 }\\\hline \text { Cash } & \$ 100,000 & (\$ 50,000) \\\text { Accounts receivable (net) } & 50,000 & 100,000 \\\text { Inventory } & 100,000 & 250,000 \\\text { Equipment (net) } & \$ 300,000 & \underline{350,000} \\{\text { Total assets }} & \$ 550,000 & \$ 650,000\\\\\text { Liabilities and Equity }\\\text { Accounts payable } & \$ 150,000 & \$ 100,000 \\\text { Income taxes payable } & 80,000 & 30,000 \\\text { Bonds payable } & 100,000 & 80,000 \\\text { Common stock } & 100,000 & 200,000 \\\text { Retained earnings } & 120,000 & 240,000 \\\quad \text { Total liabilities and Equity } & \$ 550,000 & \$ 650,000\\\\\text { A brief income statement for Year } 2 \text { shows the }\\\text { following: }\\\text { Sales }&&\$900,000\\\text { Cost of goods sold } & \$ 500,000 \\\text { Operating expenses } & 100,000 \\\text { Depreciation } & 50,000 \\\text { Income tax expense } & 100,000&750,000 \\\text { Net Income }&&\$150,000\end{array}$
-How much did Kris pay in income taxes to the government in Year 2?

• A)$30,000
• B)$80,000
• C)$110,000
• D)$150,000

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Definitions:

Unattainable

Something not possible to achieve or reach, often due to inherent limitations or barriers.

Output Growth Rate

The rate at which the production of goods and services in an economy increases over a specified period.

Taxation

The practice of collecting taxes by a government to fund public services, infrastructure, and other governmental functions.

Regulations

Rules or directives made and maintained by an authority or regulatory body to control or govern conduct within a specific area.