Question

Use the following information for Netflix Inc. to calculate the company's accounting net income for the...

Use the following information for Netflix Inc. to calculate the company's accounting net income for the year.

Sales on credit

$600,000

Sales (cash)

$700,000

Administrative Expenses

$100,000

Selling and marketing Expenses

$800,000

Interest Expenses

$160,000

Accounts Receivable (Beg. of Year)

$50,000

Accounts Receivable (End of Year)

$80,000

Accounts Payable (Beg. of Year)

$50,000

Accounts Payable (End of Year)

$100,000

Corporate Tax Rate

50%

Homework Answers

Answer #1

Ans: Accounting Net Income = $ 120,000

Particulars Amount Amount Calculation
Sales (Credit+cash) (A) $     1,300,000 600000+700000
Less: Expenses
Administrative expenses $                100,000
Selling and marketing expenses $                800,000
Interest expenses $                160,000
Total expenses (B) $     1,060,000
Income before taxes (A-B) $        240,000
Less: Taxes (50%) $        120,000
Accounting Net Income $        120,000
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