Centennial Brewery produced revenues of $1,145,227 in 2008. It has expenses (excluding depreciation) of $812,640, depreciation of $131,335, and interest expense of $81,112. It pays an average tax rate of 34 percent. What is the firm's net income after taxes?

Question

Quizplus · Accepted Answer

To find the net income, calculate the taxable income first: Revenues - Expenses - Depreciation - Interest = $1,145,227 - $812,640 - $131,335 - $81,112 = $120,140. Then, calculate taxes: $120,140 * 34% = $40,848.60. Finally, subtract taxes from taxable income: $120,140 - $40,848.60 = $79,291.40, which rounds to $79,292.

Centennial Brewery Produced Revenues of $1,145,227 in 2008