Given the following data for Shilow Company: \begin{align*}\text{Sales Revenue} &= \$120,000 \\\text{Cost of Goods Sold} &= \$70,000 \\\text{Operating Expenses} &= \$30,000 \end{align*}What is the company's net income for the period?

• A. \$120,000
• B. \$30,000
• C. \$20,000
• D. \$50,000

Answer: (C)

Verified step by step guidance

1. Step 1: Understand the formula for calculating net income. Net income is calculated as: \( \text{Net Income} = \text{Sales Revenue} - \text{Cost of Goods Sold} - \text{Operating Expenses} \).
2. Step 2: Identify the values provided in the problem. \( \text{Sales Revenue} = \$120,000 \), \( \text{Cost of Goods Sold} = \$70,000 \), and \( \text{Operating Expenses} = \$30,000 \).
3. Step 3: Substitute the values into the formula. Replace \( \text{Sales Revenue} \), \( \text{Cost of Goods Sold} \), and \( \text{Operating Expenses} \) with their respective amounts.
4. Step 4: Perform the subtraction operations step by step. First, subtract \( \text{Cost of Goods Sold} \) from \( \text{Sales Revenue} \), then subtract \( \text{Operating Expenses} \) from the result.
5. Step 5: The resulting value after performing the calculations will be the company's net income for the period.