Friday, January 2, 2009

Net Income Practice Problem

Use the following data below to calculate net income for this company:

  • Sales, $920,000
  • Cost of merchandise sold, $560,000
  • Administrative expenses, $30,000
  • Rent revenue $20,000
  • Interest expense, $10,000
  • Sales returns and allowances $65,000
  • Selling expenses, $110,000

Answer: Net Income= $165,000

How to Calculate Net Income

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