Colby Corporation has provided the following information: • Operating revenues from customers were $199,700.
• Operating expenses for the store were $111,000.
• Interest expense was $9,200.
• Gain from sale of plant and equipment was $3,300.
• Dividend payments to Colby's stockholders were $7,700.
• Income tax expense was $36,000.
• Prepaid rent expense was $5,000.
How much was Colby's net income?
A)$39,100.
B)$48,300.
C)$52,700.
D)$46,800.

Question

Quizplus · Accepted Answer

To calculate Colby Corporation's net income, we need to start with operating revenues and subtract all operating expenses, interest expense, income tax expense, and dividends paid. We'll also need to add any gains from the sale of plant and equipment.

Operating Revenues: $199,700
Operating Expenses: -$111,000
Interest Expense: -$9,200
Gain from Sale of Plant and Equipment: +$3,300
Dividend Payments: -$7,700
Income Tax Expense: -$36,000
Prepaid Rent Expense: -$5,000

Net Income: $34,100

Therefore, the correct answer is D) $46,800.

Colby Corporation Has Provided the Following Information: • Operating Revenues