If Beta Corp's net income is $210,000 and the tax rate is 30%,then the company's planned operating income is ________.
A) $325,000
B) $300,000
C) $273,000
D) $357,000

Question

Quizplus · Accepted Answer

If we assume that the tax rate is the only deduction from the net income, then we can calculate the planned operating income as below:
Planned Operating Income = Net Income / (1 - Tax rate)
= $210,000 / (1 - 0.3)
= $210,000 / 0.7
= $300,000
Therefore, the planned operating income is $300,000, which is option B.

If Beta Corp's Net Income Is $210,000 and the Tax