Alpaca corporation had revenues of 240000 in its first year, Ask an Expert

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Alpaca Corporation had revenues of $240,000 in its first year of operations. They have not collected on $19,700 of their sales, and still owe $25,600 on $90,000 of merchandise they purchased. The company had no inventory on hand at the end of the year. The company paid $11,000 in salaries. Owners invested $23,000 in the business and $23,000 was borrowed on a five-year note. The company paid $4,500 in interest that was the amount owed for the year, and paid $6,400 for a two-year insurance policy on the first day of business. Alpaca has an effective income tax rate of 40%.
Compute earnings after interest and taxes.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9978115

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