During the current fiscal year, a company had revenues of $400,000, cost of goods sold of $280,000, and an income tax r

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answerhappygod
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During the current fiscal year, a company had revenues of $400,000, cost of goods sold of $280,000, and an income tax r

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During the current fiscal year, a company had revenues of $400,000, cost of goods sold of
$280,000, and an income tax rate of 30 percent on income before income taxes. What was the
company's current year net income?

A) $120,000
B) $36,000
C) $84,000
D) $400,000
Answer: C
Explanation: ($400,000 − $280,000) = Income before income taxes, $120,000.
Income tax expense = 30% × $120,000 = $36,000.
Net income = $120,000 − $36,000 = $84,000.
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