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Use this information to answer the following questions : Calpaca Corporation had revenues of $200,000 in its first year of operations. The company has not

  1. Use this information to answer the following questions:

Calpaca Corporation had revenues of $200,000 in its first year of operations. The company has not collected on $20,000 of its sales and still owes $25,000 on $70,000 of merchandise it purchased. The company had no inventory on hand at the end of the year. The company paid $15,000 in salaries. Owners invested $20,000 in the business and $20,000 was borrowed on a five-year note. The company paid $2,000 in interest that was the amount owed for the year, and paid $6,000 for a two-year insurance policy on the first day of business. Calpaca has an effective income tax rate of 40%.

Required: Compute net income for the first year for Calpaca Corporation._________________________

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