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02 Jul 2018, 10:27
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Hi guys,
Not a GMAT question, but I cannot figure out this very basic q and wanted some help.
Carlita began 2014 with a taxes payable account balance of $3,000. On December 31, 2014, its taxes payable account balance is $7,000. How much did Carlita pay to the tax authorities during the year?
A. 2,000
B. 4,000
C. 6,000
D. Cannot be determined
Income statement:
Sales.........120,000
Less COGS.........90,000
Gross Margin.........30,000
Less Operating Expenses 10,000
Operating Income.......20,000
Less Interest Expenses.......2,000
Income before Taxes..... 18,000
Less income expense......6,000
Net income....... 12,000
So I initially thought it would be 6,000 because that's reported on the income statement-- that's what she actually paid in taxes right? I believe the answer is supposed to be 2,000.
Not a GMAT question, but I cannot figure out this very basic q and wanted some help.
Carlita began 2014 with a taxes payable account balance of $3,000. On December 31, 2014, its taxes payable account balance is $7,000. How much did Carlita pay to the tax authorities during the year?
A. 2,000
B. 4,000
C. 6,000
D. Cannot be determined
Income statement:
Sales.........120,000
Less COGS.........90,000
Gross Margin.........30,000
Less Operating Expenses 10,000
Operating Income.......20,000
Less Interest Expenses.......2,000
Income before Taxes..... 18,000
Less income expense......6,000
Net income....... 12,000
So I initially thought it would be 6,000 because that's reported on the income statement-- that's what she actually paid in taxes right? I believe the answer is supposed to be 2,000.
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03 Jul 2018, 10:18
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Hi tumpti,
Should be 2,000.
3,000+6,000 - X = 7,000 => X=2,000
Should be 2,000.
3,000+6,000 - X = 7,000 => X=2,000
Archived Topic
Hi there,
This topic has been closed and archived due to inactivity or violation of community quality standards. No more replies are possible here.
Where to now? Join ongoing discussions on thousands of quality questions in our Quantitative Questions Forum
Still interested in this question? Check out the "Best Topics" block above for a better discussion on this exact question, as well as several more related questions.
Thank you for understanding, and happy exploring!
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