please check my answers below and correct me if i am wrong please
1. At Lexi Corp., sales revenue is $20 million, the cost of goods sold is $14 million, operating expenses are $3 million, and income taxes are $1 million. What is the company's operating income?
Select one:
A. $17 million
B. $3 million
C. $2 million
D. $6 million
E. None of these
2. A company has $3.25 million in revenue and has a revenue cost of $1 million. Which of the following statements is true?
Select one:
A. In order to have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than $0.25 million.
B. In order to have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than $2.25 million.
C. In order to have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than $1.75 million.
D. In order to have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than $0.75 million.
E. In order to have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than $2.75 million.
my answrs:
1.E
2. C
The 14M, the 3M and the 1M are all expenses
so what is 20 - (14+3+1) ??
I get 2 Million
yes i realized that, i miss calculated the numbers, for the second one i miss typed my answer, i meant A and D, i am very confused since in both cases the answer is right?
1. Your answer for the first question is incorrect. To calculate the company's operating income, we need to subtract the cost of goods sold and operating expenses from the sales revenue.
Operating Income = Sales Revenue - Cost of Goods Sold - Operating Expenses
Operating Income = $20 million - $14 million - $3 million = $3 million
So, the correct answer for the first question is B. $3 million.
2. Your answer for the second question is correct. To have a net income of more than $1.5 million, we need to subtract the revenue cost, operating expenses, and income taxes from the revenue.
Net Income = Revenue - Revenue Cost - Operating Expenses - Income Taxes
Net Income = $3.25 million - $1 million = $2.25 million
So, if we want to have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than $1.75 million.
Therefore, the correct answer for the second question is C. In order to have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than $1.75 million.
1. To find the company's operating income, we need to subtract the cost of goods sold and operating expenses from the sales revenue.
Operating Income = Sales Revenue - Cost of Goods Sold - Operating Expenses
In this case:
Sales Revenue = $20 million
Cost of Goods Sold = $14 million
Operating Expenses = $3 million
Operating Income = $20 million - $14 million - $3 million
Operating Income = $3 million
So, the correct answer is B. $3 million.
2. In order to find out whether the net income can be more than $1.5 million, we need to calculate the difference between the revenue and revenue cost.
Difference = Revenue - Revenue Cost
In this case:
Revenue = $3.25 million
Revenue Cost = $1 million
Difference = $3.25 million - $1 million
Difference = $2.25 million
To have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than the difference.
The correct answer is B. In order to have a net income of more than $1.5 million, the operating expenses and income taxes need to be less than $2.25 million.