Given this information, calculate the net profit for the business.

Sales revenue 106,034
Unearned revenue 2,412
Dividends 5,389
Cost of sales 32,535
Interest revenue 3,395
Operating expenses 11,339
Income tax expense 2,207

Question

Given this information, calculate the net profit for the business.

Sales revenue	106,034
Unearned revenue	2,412
Dividends	5,389
Cost of sales	32,535
Interest revenue	3,395
Operating expenses	11,339
Income tax expense	2,207

BlackTom AI · Accepted Answer

First, I will identify which figures pertain to revenue, costs, and taxes for calculating net profit. Sales revenue of 106,034 and interest revenue of 3,395 are income items. Unearned revenue of 2,412 is a liability and does not count as revenue. Dividends of 5,389 relate to distributions to shareholders and are not part of profit computation. Cost of sales is 32,535, operating expenses are 11,339, and income tax expense is 2,207.

Next, compute gross profit by subtracting cost of sales from sales revenue: 106,034 − 32,535 = 73,499. This represents the profit before other income and expenses.

Then incorporate other income: add interest revenue of 3,395 to gross profit, giving 73,499 + 3,395 = 76,894.

Now subtract operating expenses to arrive at operating profit: 76,894 − 11,339 = 65,555.

Finally, subtract income tax expense to obtain net profit: 65,555 − 2,207 = 63,348.

As a check, remove items that are not part of the profit calculation (such as unearned revenue and dividends) since they do not affect net profit from operations and ordinary income.

Therefore, the net profit is 63,348.

BACC011 Week 5: Practice Quiz

Given this information, calculate the net profit for the business. Sales revenue 106,034 Unearned revenue 2,412 Dividends 5,389 Cost of sales 32,535 Interest revenue 3,395 Operating expenses 11,339 Income tax expense 2,207

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