During the year, Belyk Paving Co. had sales of $2,383,000. Cost of goods sold, a
ID: 2587622 • Letter: D
Question
During the year, Belyk Paving Co. had sales of $2,383,000. Cost of goods sold, administrative and selling expenses, and depreciation expense were $1,442,000, $436,700, and $491,700, respectively. In addition, the company had an interest expense of $216,700 and a tax rate of 40 percent. (Ignore any tax loss carryback or carryforward provisions.) a. What is the company’s net income? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) Net income _______ $ b. What is it's operating cash flow? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) Operating cash flow $_______
Explanation / Answer
Particulars
(In $)
Sales
2,383,000
Less: Cost of Goods Sold
(1,442,000)
Gross profit
941,000
Less: Adm. And Selling Expenses
(436,700)
Depreciation
(491,700)
Net profit before Interest
12,600
Interest
(216,700)
Net Income Before Tax
(204,100)
Tax@40%
-
Net Income
(204,100)
Net Income = (204,100)
2.
Cash Flow from Operating
Particulars
(In $)
Sales
2,383,000
Less: Cost of Goods Sold
(1,442,000)
Gross profit
941,000
Less: Adm. And Selling Expenses
(436,700)
Depreciation
(491,700)
Net profit before Interest
12,600
ADD: Depreciation
491,700
Net Operating Cash flow
504,300
Operating Cash Flow = $504,300
Particulars
(In $)
Sales
2,383,000
Less: Cost of Goods Sold
(1,442,000)
Gross profit
941,000
Less: Adm. And Selling Expenses
(436,700)
Depreciation
(491,700)
Net profit before Interest
12,600
Interest
(216,700)
Net Income Before Tax
(204,100)
Tax@40%
-
Net Income
(204,100)
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