Question

1.If profit after tax and interest is $400,000; interest expense is $50,000 and taxation expense is $84,000; profit before interest and tax is:

2.If the beginning balance of equity is $82,000; the ending balance is $37,000; and the loss for the period is $33,000; how much did the owner withdraw during the period for personal use?

3.The balance sheet usually reports the entity's financial position for both the current period and the previous period. This information is known as:

Answer 1

1. If profit after tax and interest is $400,000; interest expense is $50,000 and taxation expense is $84,000; profit before interest and tax is:

Profit before interest and tax = profit after tax and interest + interest expense + taxation expense

Where,

Profit after tax and interest = $400,000

Interest expense = $50,000

Taxation expense = $84,000

Therefore,

Profit before interest and tax =$400,000 + $50,000 + $84,000

= $534,000

The profit before interest and tax is $534,000

2. If the beginning balance of equity is $82,000; the ending balance is $37,000; and the loss for the period is $33,000; how much did the owner withdraw during the period for personal use?

Owner’s withdrawal during the period for personal use = The beginning balance of equity - The ending balance of equity - The loss for the period

Where,

The beginning balance of equity = $82,000

The ending balance of equity = $37,000

The loss for the period = $33,000

Therefore,

Owner’s withdrawal during the period for personal use = $82,000 - $37,000 - $33,000

= $12,000

Therefore the owner withdraw $12,000 during the period for personal use

3. The balance sheet usually reports the entity's financial position for both the current period and the previous period. This information is known as the statement of financial position.

A balance sheet is a financial statement that summarizes the firm’s assets, its liabilities and shareholders' equity at a particular date including both the current period and the previous period. This information is known as the statement of financial position.