Omar Shipping Company bought a tugboat for $75,000 (year 0) and expected to use it for five years after which it will be sold for $12,000. Suppose the company estimates the following revenues and expenses from the tugboat investment for the first operating year:
If the company pays taxes at the rate of 30% on its taxable income, what is the net income during the first year?
(a) $28,700
(b) $81,200
(c) $78,400
(d) $25,900