Question

Linking accrual accounting and cash flows) Catdog Corporation earned revenues of $45 million during 20X7 and ended the year with net income of $8 million. During 20X7, Catdog collected \$25 million from customers and paid cash for all of its expenses plus an additional $5 million for amounts payable at December 31, 20X6. Answer these questions about Catdog's operating results, financial position, and cash flows during 20X7: How much were Catdog's total expenses

Answer 1

Total expenses for Catdog Corporation in the year 20X7 are calculated by subtracting the net income from the revenues, which are $45 million and $8 million, respectively. The total expenses amount to $37 million.

Step-by-step explanation:

The student has inquired about the total expenses for Catdog Corporation for the year 20X7. To calculate the total expenses, we need to look at their reported revenues and net income. Given the revenue of $45 million and net income of $8 million, we can find the expenses by subtracting the net income from the revenues.

Here is the calculation:

Revenues: $45 million

Net Income: $8 million

Total Expenses: Revenues - Net Income = $45 million - $8 million = $37 million

Therefore, Catdog Corporation's total expenses for 20X7 were $37 million.