3. Identify the primarydescribed by each event below: gross income, depreciation

Question

3. Identify the primarydescribed by each event below: gross income, depreciation, operating expense, taxable income, income tax, or net operating profit after taxes. a) A new machine had a first-year write-off of $10,500 b) A public corporation estimates that it will report a S-750,000 net profit on its annual income statement. c) An asset with a book value of $8000 was retired and sold for $8450 d) An over-the-counter software system will generate $420,000 in revenue this quarter e) An asset with a MACRS recovery period of 7 years has been owned for 10 years. It was just sold for $2750 ) The cost of goods sold in the past year was $3,680,200 g) A convenience store collected $33,550 in lottery ticket sales last month. Based h) An asset with a first cost of $65,000 was utilized on a new product line to i) on winners holding these tickets, a rebate of $350 was sent to the manager increase sales by $150,000 The cost to maintain equipment during the past year was $641,000

Explanation / Answer

a) A new machine had a first-year write-off of $10,500 - Depreciation

b) A public corporation estimates that it will report a $-750,000 net profit on its annual income statement. - Net operating profit after taxes.

c) An asset with a book value of $8000 was retired and sold for $8450 - taxable income

d) An over-the-counter software system will generate $420,000 in revenue this quarter - gross income

e) An asset with a MACRS recovery period of 7 years has been owned for 10 years. It was just sold for $2750 - taxable income.

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