United Brands Corp. just completed their latest fiscal year. The firm had sales of $16,650,000. Depreciation and amortization was $832,500, interest expense for the year was $825,000, and selling general and administrative expenses totaled $1,665,000 for the year, and cost of goods sold was $9,990,000 for the year. Assuming a federal income tax rate of 34%, what was the United Brands net income after-tax?

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Quizplus · Accepted Answer

Net income = Sales - Cost of goods sold - Depreciation and amortization - Interest expense - Selling general and administrative expenses - TaxesNet income = $16,650,000 - $9,990,000 - $832,500 - $825,000 - $1,665,000 - ($2,202,750 x 0.34)Net income = $2,202,750