Question

Zigs Industries had the following operating results for 2015: sales = $25,152; cost of goods sold = $15,403; depreciation expense = $4,062; interest expense = $2,174; dividends paid = $1,849. At the beginning of the year, net fixed assets were $17,099, current assets were $5,695, and current liabilities were $3,092. At the end of the year, net fixed assets were $20,506, current assets were $7,607, and current liabilities were $3,151. The tax rate for 2015 was 34 percent. What is net income for 2015?

Answer 1

To calculate the net income for 2015, we need to subtract all the expenses from sales.

Operating expenses:
Cost of goods sold: $15,403
Depreciation expense: $4,062
Interest expense: $2,174
Dividends paid: $1,849

Total operating expenses = $15,403 + $4,062 + $2,174 + $1,849 = $23,488

Net income = Sales - Total operating expenses

Net income = $25,152 - $23,488 = $1,664