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Alpaca Corporation had revenues of $290,000 in its first year of operations. The company has not collected on $18, 700 of its sales and still
Alpaca Corporation had revenues of $290,000 in its first year of operations. The company has not collected on $18, 700 of its sales and still owes $25, 900 on $95,000 of merchandise it purchased. The company had no inventory on hand at the end of the year. The company paid $12,000 in salaries. Owners invested $15,000 in the business and $15,000 was borrowed on a five-year note. The company paid $3, 900 in interest that was the amount owed for the year, and paid $6, 700 for a two-year insurance policy on the first day of business. Alpaca has an effective income tax rate of 30%. Compute net income for the first year for Alpaca Corporation. $175, 750 $123, 025 $120, 680 $195,000
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