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irakobra [83]
3 years ago
6

Butterfly tractors had $14 million in sales last year. cost of goods sold was $8.00 million, depreciation expense was $2 million

, interest payment on outstanding debt was $1 million, and the firm's tax rate was 35%.
a. what was the firm's net income?
Business
1 answer:
Kruka [31]3 years ago
8 0
The net income is $1.95 million, this is how we calculate this;
Sales last year is $14 million
Goods sold cost = $8 million
Depreciation expense = $2 million and debt is $1 million.
So the amount left = $14 million - ($8million + $2 million + $1 million ) = 14 - 11 = 3 million
tax rate is 35 %, so 35% of 3 million = 0.35 x 3 = $1.05 million
Net income = $3 million - $1.05 million = $1.95 million
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