If the Tax Rate Is 30%, Interest Expense Is $15,000

question 28

Multiple Choice

If the tax rate is 30%, interest expense is $15,000 and operating profit is $82,000, what is the profit for the year?

• A)$63,000.
• B)$44,100.
• C)$46,900
• D)None of the above.

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Definitions:

Diminishing Returns

A principle stating that if one input in the production of a commodity is increased while all other inputs are held fixed, a point will eventually be reached at which additions of the input yield progressively smaller, or diminishing, increases in output.

Production Function

The relationship between the quantity of inputs a firm uses and the quantity of output it produces.

Inputs

The resources, such as labor, materials, and capital, that are used in the production process to produce goods or services.

Output

The total amount of goods or services produced by a company, industry, or economy within a specified time period.