how to calculate the net income
in this income statement , usually we just use pretax income - tax
= net income, why there is not like that?
Homework Answers
The net income shown in the given case is based on multi -step income format. This is the standard practice for publishing income statements by public companies. Please see the last line in the given Income statement as net income. If you see the 4th and 5th line from bottom it has pre-tax income and income tax expense which gives net income.This net income is used for calculation of net profit margin, Return on equity, Earning per share, etc
Net Income should be calculated in below ways.
Total revenue
Less: Cost of revenue
Equal to = Gross profit
Less: Operating profit
Equal to = Operating Income
Add: Non operating income and expense
Add: Interest income from non –operating
Less: Interest expense from –operating
Add/Less: Other Income (expense)
Equal to pre tax income (Earnings before tax)
Less: Tax provision
Net Income (available to common shareholders)
Add Answer to:
how to calculate the net income
in this income statement , usually we just use pretax...
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Please fill in the grey spaces for the updated Income Statement. There is a sale change...
Please fill in the grey spaces for the updated Income
Statement.
There is a sale change of 8%. Margins stay the same, Tax Rate is
21% and no dividends. Shares outstanding remain the same. Future
Dividend Payout is 10%
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a. How does this income statement differ from the ones presented in Exhibit 3.1 and Problem...
a. How does this income statement differ from the ones presented
in Exhibit 3.1 and Problem 3.2?
b. Why does Green Valley show a provision for income taxes while
the other two income statements did not?
c. What is Green Valley’s total profit margin? How does this
value compare with the values for Sunnyvale Clinic and
BestCare?
d. The before-tax profit margin for Green Valley is operating
income divided by total revenues. Calculate Green Valley’s
before-tax profit margin. Why may...
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Please fill in the grey spaces for the updated Income
Statement.
There is a sale change of 8%. Margins stay the same, Tax Rate is
21% and no dividends. Shares outstanding remain the same. Future
Dividend Payout is 10%
с H 12 Months Ended Dec. 31, 2019 Dec 31, 2018 Dec 31, 2017 $5,586,369 $ 4,864,985 $ 4,476,412 Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands Consolidated Statements of Income [Abstract] Revenue Restaurant operating costs...
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a. How does this income statement differ from the ones presented
in Exhibit 3.1 and Problem 3.2?
b. Why does Green Valley show a provision for income taxes while
the other two income statements did not?
c. What is Green Valley’s total profit margin? How does this
value compare with the values for Sunnyvale Clinic and
BestCare?
d. The before-tax profit margin for Green Valley is operating
income divided by total revenues. Calculate Green Valley’s
before-tax profit margin. Why may...
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