Question

calculate the net income after corporate income tax is paid for quarter 1.
income statement

	q1 (x1000)	q2 (x1000)
cogs	(42)	(30)
gross profit	108	60
overhead	(50)	(40)
pre - tax income	58	20

corporate income tax = $12,180
net income = $?

Explanation:

Step1: Understand the formula for Net Income

Net Income is calculated as Pre - tax Income minus Corporate Income Tax. First, we need to note that the Pre - tax Income for Q1 is given in thousands (since Q1 is in x1000). So the Pre - tax Income in dollars is \(58\times1000=\$58000\).

Step2: Calculate Net Income

The formula for Net Income is \(Net\ Income = Pre - tax\ Income - Corporate\ Income\ Tax\). We know that Pre - tax Income (in dollars) is \(58\times1000 = 58000\) and Corporate Income Tax is \(\$12180\). So we substitute these values into the formula: \(Net\ Income=58000 - 12180\).

Step3: Perform the subtraction

\(58000-12180 = 45820\).

Answer:

\(45820\)