Alphabet Inc. (Google) Income Statement For the Year Ended December 31, Year 2

• Sales revenue: $730,500
• Cost of goods sold: $430,400
• Gross profit: $300,100
• Operating expenses: $120,300
• R&D expenses: $(30,400)
• Depreciation expense: $35,000
• Operating income: $110,200
• Nonoperating income: $20,500
• Loss on sale of machinery: $(20,300)
• Net income: $110,400

Balance Sheet As of December 31, Year 2

• Assets:
  • Cash: $80,500
  • Accounts receivable: $160,400
  • Merchandise inventory: $150,300
  • Equipment less accumulated depreciation: $200,700
  • Nonoperating assets: $138,600
  • Total assets: $730,500
• Liabilities:
  • Accounts payable: $70,400
  • Notes payable: $100,300
  • Stockholders’ equity:
    • Common stock: $400,000
    • Retained earnings: $159,800
    • Total liabilities and stockholders’ equity: $730,500

Required:

1. Compute the gross profit margin.
2. Calculate the current ratio.
3. Determine the debt-to-equity ratio.
4. Evaluate the ROI for Alphabet Inc.
5. Calculate the operating margin.