Blossom Products Is Considering a Special Project That Will Increase

question 14

Multiple Choice

Blossom Products is considering a special project that will increase sales revenue by $60 000 without affecting costs.If the company has a tax rate of 25 per cent,what will be the after-tax profit?

• A) $ 60 000
• B) $ 45 000
• C) $ 15 000
• D) $105 000

---

Definitions:

Return on Assets

A financial ratio that indicates the profitability of a company in relation to its total assets.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or the operating cycle, whichever is longer.

Net Income

Refers to the total earnings or profit of a company after subtracting all expenses from its total revenue.

Total Debts

The sum of all financial obligations a company owes to outside parties, including both short-term and long-term liabilities.