20. a financial analyst at rmo manufacturing corporation has assembled the following data for the last fiscal year. all data is in millions (m). gross sales $12m interest expenses $0.5m returns and allowances $1m taxes $0.1m cost of goods sold $3m cash dividends $0.4m operating expenses $3m common stock $1m what is the net income or loss for the rmo manufacturing corporation for the last fiscal year? a. net loss of $5m b. net income of $4m c. net loss of $4m d. net income of $5m

Net Income for an organization is the Profit After tax and dividend paid. The formula for Net Income is:

Net Income = Sales - Cost of goods Sold - Operating Expenses - Return and Allowances - Taxes - Cash dividends

From the data given,

Sales = $12 Million

Cost of Goods Sold = $3 Million

Operating Expenses = $3 Million

Interest Expenses = $0.5 Million

Returns and Allowances = $1 Million

Taxes = $0.1 Million

Cash Dividend = $0.4 Million

By putting the variables in the above formula,

Net Income = $12 Million - $3 Million - $1 Million - $3 Million - $0.5 Million - $0.1 Million - $0.4 Million

Net Income = $4 Million

Therefore, the answer is B Net Income is $ 4 Million