On December 31,2019,The Bates Company's revenue is $300,000 and expenses total $160,000 before consideration of the following: Accrued wages total $11,000;
Accrued revenues total $36,000;
Depreciation expense is $17,000;
Rental revenue of $9,000 was earned;the rent from a tenant was initially recorded by Bates as unearned rent revenue;
The income tax rate is 40% of income before income taxes.
What is Bates' net income after consideration of the above information?

Question

Quizplus · Accepted Answer

To calculate Bates' net income after considering the given information, we start with the initial revenue and expenses and adjust for the additional items:Initial revenue: $300,000+ Accrued revenues: $36,000+ Rental revenue: $9,000 (since it was initially recorded as unearned, it now needs to be recognized as earned revenue)= Adjusted revenue: $345,000Initial expenses: $160,000+ Accrued wages: $11,000+ Depreciation expense: $17,000= Adjusted expenses: $188,000Adjusted income before taxes: $345,000 - $188,000 = $157,000Income tax (40% of $157,000): $157,000 * 0.40 = $62,800Net income after taxes: $157,000 - $62,800 = $94,200

On December 31,2019,The Bates Company's Revenue Is $300,000 and Expenses