Question

Ski-Doo Company manufactures, markets, and sells snowmobiles and snowmobile equipment and accessories. The average total assets for Ski-Doo is \(3,000,000. In its most recent year, Ski-Doo reported net income of \)201,000 on revenues of $1,400,000.

Required 3. What are the total expenses for Ski-Doo Company in its most recent year?

Short answer

The total expenses are $1,199,000.

Step-by-step solution

Definition of Expenses

The expenses are defined as the cost incurred by the business during an accounting period to generate revenue or income.

Computation of expenses

$\begin{array}{rcl}\mathrm{Expenses}& =& \mathrm{Revenue}-\mathrm{Net}\mathrm{income}\\ & =& 1,400,000-201,000\\ & =& \$1,199,000\end{array}$