Using the information provided,calculate net income for 2009.Assume a tax rate of 40 percent.
A)$33,000
B)$44,000
C)$55,000
D)$66,000

Question

Using the information provided,calculate net income for 2009.Assume a tax rate of 40 percent. 
A)$33,000 
B)$44,000 
C)$55,000 
D)$66,000

Quizplus · Accepted Answer

Net income is calculated by subtracting the total expenses from the total revenue. From the given chart, the total revenue for 2009 is $90,000 and the total expenses are $60,000. Therefore, the net income before taxes is $30,000.

To calculate net income after taxes, we need to apply the tax rate of 40 percent.

Net income after taxes = Net income before taxes - (Tax rate x Net income before taxes)
Net income after taxes = $30,000 - (0.40 x $30,000)
Net income after taxes = $30,000 - $12,000
Net income after taxes = $18,000

Therefore, the net income for 2009 is $18,000 or $33,000 after taxes (if you are looking for the answer in terms of net income after taxes, choose A).

Using the Information Provided,calculate Net Income for 2009