Reference no: EM132731051

Problem 1: Compute the OPT

Star Bus Company (a domestic common carrier) has the following data for the first quarter of the current year.

Gross receipts, passenger operations          8,000,000
Gross revenue from cargo operations          5,000,000
Expenses, passenger operations               4,750,000
Expenses, cargo operations                   2,500,000
Gross receipts - rental of facilities           2,000,000

Additional information:

• 25% of its gross revenue from cargo operations were still outstanding as of the end of the quarter