Blossom Products Is Considering a Special Project That Will Increase

question 60

Multiple Choice

Blossom Products is considering a special project that will increase sales revenue by $127,000 without affecting costs. If the company has a tax rate of 40%, what will be the after-tax income?

• A) $ 50,800
• B) $ 76,200
• C) $127,000
• D) $203,200

---

Definitions:

Financial Statements

Documents that provide an overview of a company's financial condition, including the balance sheet, income statement, and cash flow statement.

Journalized

The process of recording transactions in a journal before they are posted to the general ledger in accounting.

Income Summary Account

A temporary account used in the closing process that aggregates all income and expense accounts to determine net income or loss for a period.

Permanent Account

An account in the general ledger that carries its ending balance over to the next accounting period, such as assets, liabilities, and equity accounts.