Cost of goods sold $575,000 Gross profit 1,600,000 General and administrative expense 200,000 Selling and marketing expense ------------------- Depreciation 50,000 Operating income --------------------- Interest 100,000 Income before taxes -------------------- Income taxes (30%) --------------------- Net income $700,000

\begin{tabular}{|l|r|} \hline Sales & $2,175,000 \\ \hline COGS & 575,000 \\ \hline \multicolumn{1}{|c|}{ Gross profit } & $1,600,000 \\ \hline G\&A expense & 200,000 \\ \hline Sales \& Mkting expense & \\ \hline Depreciation & 50,000 \\ \hline Operating income & \\ \hline Interest & 100,000 \\ \hline \multicolumn{1}{|c|}{ Income before taxes } & \\ \hline Income taxes (30\%) & \\ \hline Net income & $700,000 \\ \hline \end{tabular} Steps: 1: Calculate Sales 2. Calculate Income before taxes. Taxes are 30%, so you know the Net Income (Y) is a percent of "Income before taxes" (X) 3. Calculate the Income taxes figure 4. Calculate Operating Income 5. Calculate Sales \& Mkting Exp