Calculate Net Income Based on the Following Information: Sales Are

question 90

Multiple Choice

Calculate net income based on the following information: sales are $300; cost of goods sold is $150,depreciation expense is $60,interest paid is $30,and the tax rate is 40%.

• A)$36.00
• B)$38.50
• C)$40.50
• D)$56.80
• E)$60.00

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Definitions:

Variable Cost

A type of cost that varies with production volume, increasing as production increases and decreasing as production decreases.

Carrying Cost

Expenses incurred by holding inventory or assets over a period, including storage, insurance, and opportunity costs.

Present Value

The present value of an amount of money or series of payments to be received in the future, calculated using a particular interest rate.

Credit Policy Change

Adjustments made to the guidelines that govern the extension of credit to customers, affecting terms of payment and eligibility.