1. Alpaca Corporation had revenues of $210,000 in itsfirst year of operations. The company has not collected on $19,500of its sales and still owes $26,800 on $85,000 of merchandise itpurchased. The company had no inventory on hand at the end of theyear. The company paid $13,500 in salaries. Owners invested $17,000in the business and $17,000 was borrowed on a five-year note. Thecompany paid $4,200 in interest that was the amount owed for theyear, and paid $7,400 for a two-year insurance policy on the firstday of business. Alpaca has an effective income tax rate of 40%.Compute net income for the first year for Alpaca Corporation.

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