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Using the following information, compute NET INCOME. Cost of Goods Sold $ 6,000 Interest Expense 1,100...

Using the following information, compute NET INCOME.

Cost of Goods Sold

$ 6,000

Interest Expense

1,100

Selling and Administrative Expense

750

Cash

400

Sales

10,000

Wages Payable

250

Dividends

700

Retained Earnings (beginning)

1,000

Income Tax Expense

1,200
  • $1,700
  • $1,350
  • $1,950
  • $700
  • $950
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Answer #1

Correct answer----------$950

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Income Statement
Sales   $     10,000.00
Cost of goods sold $       6,000.00
Gross margin $       4,000.00
Selling and administrative expenses $           750.00
Net operating income $       3,250.00
Interest expense $       1,100.00
Net income before taxes $       2,150.00
Income taxes   $       1,200.00
Net income $           950.00
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