Question

Suppose Nippon Technology has the following revenue and expenses for 2019:

Revenues of $8,700,000
Cost of Goods Sold of $1,740,000
Depreciation Expenses of $1,200,000
Income Taxes of $1,776,000
Interest Expenses of $50,000
Other Expenses of $400,000
Sales, General, & Administrative Expenses of $870,000

Create an income statement with amounts in thousands

What is the value of Earnings?

Please specify your answer in the same units as the income statement.

Answer 1

Income statement records income and expenses to find Net Income

Nippon technology Income statement for the year ending 2019 (In thousands)

Revenues	$8,700
Less: Cost of goods sold	-$1,740
Gross Profit		$6,960	[$8,700-1,740]
Less:
Sales, General, & Administrative Expenses	$870
Depreciation Expenses	$1,200
Other Expenses	$400
Total operating expense		-$2,470
Earnings before interest and taxes		$4,490
Less:
Interest		-$50
Taxes		-$1,776
Net Income		$2,664	[$4,490-50-1,776]

Value of earnings =$2,664

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