The table is an excerpt from an income statement at the end of a year for Company A. When the net income for the year is 800 million yen, how much are the selling, general, and administrative expenses in millions of yen? Unit: Million yen | Net sales | 8,000 Cost of goods sold | 6,000 Selling, general, and administrative expenses | [ ] Non-operating income | 150 Non-operating expenses | 50 Extraordinary income | 60 Extraordinary loss | 10 Income taxes | 350

IPA IP 2024 Question 8

A question IPA Japan published in 令和6年度 ITパスポート試験公開問題問8, translated into English. ITPEC is based on the same exams.

Same question on ITPEC: Apr 2026 Q72

The table is an excerpt from an income statement at the end of a year for Company A. When the net income for the year is 800 million yen, how much are the selling, general, and administrative expenses in millions of yen?

Unit: Million yen

Net sales	8,000
Cost of goods sold	6,000
Selling, general, and administrative expenses	blank
Non-operating income	150
Non-operating expenses	50
Extraordinary income	60
Extraordinary loss	10
Income taxes	350

a)850b)900c)1,000d)1,200

Explanation

1,000 million yen — work down the income statement from net sales to net income, then solve for the missing expense S.

Step	Amount (million yen)
Gross profit: net sales − cost of goods sold	8000 − 6000 = 2000
Operating income: − SG&A expenses	2000 − S
Ordinary income: + non-operating income − non-operating expenses	2000 − S + 150 − 50 = 2100 − S
Income before taxes: + extraordinary income − extraordinary loss	2100 − S + 60 − 10 = 2150 − S
Net income: − income taxes	2150 − S − 350 = 1800 − S

Net income is 800, so 1800 − S = 800 and S = 1000.

Answer (c)

Why not others:

•(a) 850 — subtracts only the income taxes and leaves out the non-operating and extraordinary items: 2000 − 350 − 800 = 850
•(b) 900 — leaves out the non-operating items (net +100) but keeps the rest: 2000 + 50 − 350 − 800 = 900
•(d) 1,200 — treats the net income as if it were operating income, 2000 − 800, ignoring everything below it

Key rule: Gross profit − SG&A = operating income; ± non-operating items = ordinary income; ± extraordinary items = income before taxes; − taxes = net income.

Corporate Activities · AI-written, may contain errors

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This question comes from the past questions IPA Japan publishes, translated into English by ITPEC Practice. ITPEC Practice is an independent study tool and is not affiliated with IPA or ITPEC. See the original paper (PDF) or Report an issue.