Alpaca Corporation had revenues of $290,000 in its first year of operations. The company has not collected on $19,900 of its sales and still owes $25,800 on $90,000 of merchandise it purchased. The company had no inventory on hand at the end of the year. The company paid $14,000 in salaries. Owners invested $28,000 in the business and $28,000 was borrowed on a five-year note. The company paid $4,900 in interest that was the amount owed for the year; and paid $7,000 for a two-year insurance policy on the first day of business. Alpaca has an effective income tax rate of 40%. Compute net income for the first year for Alpaca Corporation. Multiple Choice $177,600 $118,460 $106,560 $200,000 Auditors play an important role in the resource allocation process by adding credibility to financial statements. True or False