Presented below is information for Zhou Co. for the month of January 2014.

Instructions
(a) Prepare an income statement using the format presented on page 245. Assume a 25% tax rate.
(b) Calculate the profit margin and the gross profitrate.

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Cost of goods sold Freight-out Insurance expense Salaries and wages expense 32,000 8,000 12,000 Sales returns and allowances 20,000 370,000 $212,000 Rent expense 7,000 Sales discounts 60,000 Sales revenue