Question

Nataro, Incorporated, has sales of 662,000, costs of335,000, depreciation expense of 80,000, interest expense of45,000, and a tax rate of 22 percent. What is the net income for this firm?

Answer 1

To calculate the net income for Nataro, Incorporated, subtract the costs, depreciation expense, interest expense, and taxes from the sales revenue.

Step-by-step explanation:

To calculate the net income for Nataro, Incorporated, we need to subtract the costs, depreciation expense, interest expense, and taxes from the sales revenue. Here are the steps:

1. Subtract the costs from the sales revenue: $662,000 - $335,000 = $327,000
2. Subtract the depreciation expense from the result: $327,000 - $80,000 = $247,000
3. Subtract the interest expense from the result: $247,000 - $45,000 = $202,000
4. Calculate the tax amount: $202,000 x 0.22 = $44,440
5. Subtract the tax amount from the result to get the net income: $202,000 - $44,440 = $157,560

Therefore, the net income for Nataro, Incorporated is $157,560.