Question

Gracie Co. has the following information: Net Sales: $22,000 COGS: $12,000 Operating Expenses: $3,000 Interest Revenue: $800 Unearned Revenue: $1,100 Accounts Payable: $500 Accounts Receivable: $4,000 Calculate Net Income for Gracie Co.?

Answer 1

To calculate the net income for Gracie Co., subtract the cost of goods sold, operating expenses, and interest revenue from the net sales. Then subtract unearned revenue.

Step-by-step explanation:

To calculate the net income for Gracie Co., we need to subtract the cost of goods sold (COGS), operating expenses, and interest revenue from the net sales. This will give us the operating income. Then, we subtract the unearned revenue from the operating income to get the net income. Here's the calculation:

Operating Income = Net Sales - COGS - Operating Expenses - Interest Revenue

Net Income = Operating Income - Unearned Revenue

Given the information provided:

Net Income = $22,000 - $12,000 - $3,000 - $800 - $1,100 = $5,100

Therefore, the net income for Gracie Co. is $5,100.