Question

Restaurant Supply, Inc., started business on January 1, 20X1. The following information relates to 20X2, the second year of operations

Tax rate	21%
Estimated taxes paid during the year	9,000

Accounts payable	205,000
Accounts receivable	62,600
Accumulated depreciation	(161,300)
Additional paid-in-capital	292,300
Beginning retained earnings	208,300
Cash	110,000
Common stock	137,500
Cost of goods sold	241,000
Depreciation expense	96,000
Dividends delcared	(21,200)
Equipment	1,470,700
Inventory	21,700
Notes payable	511,800
Salary expense	172,000
Sales	688,000
Taxes payable	???

Given the above information, what is net income?

Answer 1

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Restaurant Supply, Inc.
Income Statement	Amount $
Sales	688,000.00
Expenses
Cost of goods sold	241,000.00
Depreciation expense	96,000.00
Salary expense	172,000.00
Total Expenses	509,000.00
Income before tax	179,000.00
Less: Tax expense @ 21%	37,590.00
Net Income	141,410.00
Taxes payable is $ 37,590.