Exercise 5-6 Presented below is information for Zhou Co. for the month of January 2014.

Cost of goods sold	$204,900	Rent expense	$34,700
Freight-out	7,100	Sales discounts	9,280
Insurance expense	14,300	Sales returns and allowances	18,500
Salaries and wages expense	63,300	Sales revenue	397,800

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Prepare an income statement using the multi-step format. Assume a 20% tax rate.

ZHOU Co. Income Statement For the Month Ended January 31, 2014
DividendsExpensesNet Income / (Loss)Retained Earnings, January 1Retained Earnings, January 31SalesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome Before Income Taxes
	$
AddLess:
	$
DividendsExpensesNet Income / (Loss)Retained Earnings, January 1Retained Earnings, January 31SalesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome Before Income Taxes
DividendsExpensesNet Income / (Loss)Retained Earnings, January 1Retained Earnings, January 31SalesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome Before Income Taxes
DividendsExpensesNet Income / (Loss)Retained Earnings, January 1Retained Earnings, January 31SalesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome Before Income Taxes
DividendsExpensesNet Income / (Loss)Retained Earnings, January 1Retained Earnings, January 31SalesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome Before Income Taxes
DividendsExpensesNet Income / (Loss)Retained Earnings, January 1Retained Earnings, January 31SalesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome Before Income Taxes
DividendsExpensesNet Income / (Loss)Retained Earnings, January 1Retained Earnings, January 31SalesTotal ExpensesTotal RevenuesNet SalesGross ProfitOperating ExpensesTotal Operating ExpensesIncome Before Income Taxes	$

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Calculate the profit margin and the gross profit rate. (Round answers to 1 decimal place, e.g. 15.2%.)

Profit margin		%
Gross profit rate		%