The 2014 Income Statement for the Clothing Division of Tom

Multiple Choice

The 2014 income statement for the Clothing Division of Tom Ron Surf Company is as follows: $\begin{array}{lr}\text { Sales } & \$ 445,000 \\\text { Operating expenses } & 270,000 \\\text { Net operating income } & 175,000 \\\text { Interest expense } & 35,000 \\\text { Earnings before taxes } & 140,000 \\\text { Income tax expense }(30 \%) & 42,000 \\\text { Net income } & \$ 98,000\end{array}$ How much is net operating profit after taxes?

A) $108,500
B) $133,000
C) $73,500
D) $122,500