Google LLC Income Statement for the Year Ended December 31, Year 8

• Sales revenue: $1,000,000
• Cost of goods sold: $600,000
• Gross margin: $400,000
• Operating expenses:
  • Selling expenses: $80,000
  • Depreciation expenses: $70,000
• Operating income: $250,000
• Nonoperating items: $30,000
• Net income: $220,000

Balance Sheet as of December 31, Year 8

• Assets:
  • Cash: $100,000
  • Accounts receivable: $200,000
  • Merchandise inventory: $170,000
  • Equipment (less accumulated depreciation): $180,000
  • Nonoperating assets: $150,000
• Total assets: $800,000
• Liabilities:
  • Accounts payable: $60,000
  • Notes payable: $50,000
  • Stockholders' equity: $690,000
• Total liabilities and stockholders' equity: $800,000

Required:

a. Calculate the gross margin percentage. b. Calculate the operating margin percentage. c. Calculate the return on assets (ROA). d. Calculate the return on equity (ROE). e. Google LLC is planning to invest in a new project costing $200,000, expected to increase net income by $50,000. Calculate the new ROA and ROE.