Smith Corporation has provided the following information:
Cash sales totaled $135,000.
Credit sales totaled $289,000.
Cash collections from customers for services yet to be provided totaled $48,000.
An $10,000 gain from the sale of property and equipment occurred.
Interest income totaled $8,700.
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Question & Answer: Smith Corporation has provided the following information:…..
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How much of these items were included in operating income?
|(a)||Cash Sales||$ 135,000|
|(b)||Credit Sales||$ 289,000|
|(c)||Gain from the sale of property and equipment||$ 10,000|
|(d)||Operating Income [(a) + (b) + (c)]||$ 434,000|
Therefore, the right option is (a) $ 434,000.
Note: Cash collected from customers for services yet to be provided and Interest Income shall not form part of Operating Income. Hence, same have been ignored.