If a firm had operating profits of 100,000 taxes of 17,000 interest expense of 34,000 and preferred dividends of 5,000. What was the firms net profit after taxes
49000
To determine the firm's net profit after taxes, we need to subtract the taxes, interest expense, and preferred dividends from the operating profits.
Net Profit After Taxes = Operating Profits - Taxes - Interest Expense - Preferred Dividends
In this case:
Operating Profits = $100,000
Taxes = $17,000
Interest Expense = $34,000
Preferred Dividends = $5,000
Substituting the values into the formula:
Net Profit After Taxes = $100,000 - $17,000 - $34,000 - $5,000
Now let's calculate:
Net Profit After Taxes = $100,000 - $17,000 - $34,000 - $5,000
= $100,000 - $56,000
= $44,000
Therefore, the firm's net profit after taxes is $44,000.