The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: The income from operations for the Locomotive Division is
A) $57,960
B) $14,790
C) $27,240
D) $47,280

Question

The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31:  The income from operations for the Locomotive Division is
A) $57,960 
B) $14,790 
C) $27,240 
D) $47,280

Quizplus · Accepted Answer

The income from operations for the Locomotive Division can be calculated by subtracting the cost of goods sold and operating expenses from the gross revenue. 
Income from operations for Locomotive Division = Gross Revenue – Cost of Goods Sold – Operating Expenses
= $161,100 - $123,960 - $10,900
= $27,240

Therefore, the correct choice is C) $27,240.

The Following Financial Information Was Summarized from the Accounting Records