Question

Selling, general, and administrative expenses were $59,000; net sales were $268,100; interest expense was $6,300; research and development expenses were $27,800; net cash provided by operating activities was $69,900; income tax expense was $6,700; cost of goods sold was $145,500. Required: a. Calculate operating income for the period. b. Calculate net income for the period.

Answer 1

a. $35,800

b. $22,800

Step-by-step explanation:

The computation of the net operating income and the net income is shown below:

a. Net operating income is

= Net sales - cost of goods sold - Selling, general, and administrative expenses - research and development expenses

= $268,100 - $145,500 - $59,000 - $27,800

= $35,800

b. Now the net income is

= Net operating income - interest expense - tax expense

= $35,800 - $6,300 - $6,700

= $22,800

We simply applied the formula in order to get the net operating income and the net income