Exercise 6-16 (Algo) Calculate levels of profitability for a multiple-step income statement and the gross profit ratio (LO6-2, 6-7) Below are amounts found in the income statements of three companies. Cost of Goods Operating Sold Expenses $4,200 Company Henry Grace James Net Sales $16,000 19,000 24,000 $3,200 12,350 13,680 7,200 2,200 Nonoperating Expenses $1,200 3,200 0 Income Tax Expense $1,200 0 2,200 Required: 1. For each company, calculate (a) gross profit, (b) operating income, (c) income before income taxes, and (d) net income. 2-a. For each company, calculate the gross profit ratio. 2-b. Which company has the most favorable ratio?

Exercise 6-16 (Algo) Calculate levels of profitability for a multiple-step income statement and the gros profit ratio (LO6-2, 6-7) Below are amounts found in the income statements of three companies. Required: 1. For each company, calculate (a) gross profit, (b) operating income, (c) income before income taxes, and (d) net income. 2-a. For each company, calculate the gross profit ratio. 2-b. Which company has the most favorable ratio