Bullseye, Inc.'s 2018 income statement lists the following income and expenses: EBIT = $900,000, interest expense = $85,000, and net income = $570,000. What are the 2018 taxes reported on the income statement?
A) $245,000
B) $330,000
C) $815,000
D) There is not enough information to calculate 2018 taxes.

Question

Quizplus · Accepted Answer

Taxes can be calculated by subtracting interest expense and net income from EBIT. So, taxes = $900,000 - $85,000 - $570,000 = $245,000.