Arizona Company Has the Following Information Available for the Month

question 114

Multiple Choice

Arizona Company has the following information available for the month of April:
$\begin{array}{ll}\text { Sales }&\$100,000\\\text { Cost of goods sold } & \$ 60,000 \\\text { Interest expense } & \$ 2,000 \\\text { Income taxexpense } & \$ 1,000 \\\text { Wages expense } & \$ 12,000 \\\text { Dividends declared } & \$ 3,000 \\\text { Equipment purchased } & \$ 20,000 \\\text { Rent expense } & \$ 4,000\end{array}$
The company uses the accrual basis of accounting.What is the net income for the month of April?

• A) $21,000
• B) $22,000
• C) $24,000
• D) $27,000

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Definitions:

Gross Salary

The total of an employee's regular earnings before taxes and other deductions.

Annual Salary

The total amount of money earned by an employee in a year, not including bonuses or other extra payments.

Salary Per Period

Salary per period refers to the total compensation an employee receives in each payment cycle, such as monthly or bi-weekly.

Retail Sales

The total value of goods sold to consumers by retailers.