Use the Information Below to Answer the Following Questions -If Salaries Expense Amounting to $3000 Were Eliminated,what Would Be

question 32

Multiple Choice

Use the information below to answer the following questions. Each question is to be considered separately.
The income statement of Berrima Barbed Wire Ltd is:
$\begin{array}{lr} & \$ \\ \text { Revenue } & 22,000 \\ \text { Expense } & \underline{12,000} \\ \text { Profit before income tax } & 10,000 \\ \text { Income tax expense }(30 \%) & \underline{3,000} \\ \text { Net profit } & \underline{7,000}\end{array}$
-If salaries expense amounting to $3000 were eliminated,what would be the effect on net profit after tax?

• A) It would decrease by $2100.
• B) It would decrease by $3000.
• C) It would increase by $2100.
• D) It would increase by $3000.

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Definitions:

Visible Light

The portion of the electromagnetic spectrum that can be perceived by the human eye.

Dimethoxy-1,3-butadiene

An organic compound characterized by a 1,3-butadiene backbone with two methoxy groups attached, often used as a chemical intermediate.

Diels-Alder

A [4+2] cycloaddition reaction between a conjugated diene and a dienophile forming six-membered rings.

Diels-Alder

A chemical reaction between a conjugated diene and a substituted alkene (dienophile) to form a cyclic compound.