Question
info: Salaries and wages expenses $ 460 Research and development expense $ 114 Depreciation expense 90 Income tax expense 770 Sales revenue 7,830 Loss on
info:
Salaries and wages expenses | $ 460 | Research and development expense | $ 114 | |||
---|---|---|---|---|---|---|
Depreciation expense | 90 | Income tax expense | 770 | |||
Sales revenue | 7,830 | Loss on disposal of plant assets | 46 | |||
Interest expense | 161 | Cost of goods sold | 3,800 | |||
Advertising expense | 499 | Rent expense | 105 | |||
Sales returns and allowances | 230 | Utilities expense | 60 |
Assume a tax rate of 34%.
b)
Gross profit rate: 50%
Profit margin: 380000%
c1) Assume the marketing department has presented a plan to increase advertising expenses by $340 million. It expects this plan to result in an increase in both net sales and cost of goods sold of 25%. (Hint: Increase both sales revenue and sales returns and allowances by 25%.) Redo parts (a) and (b) and discuss whether this plan has merit. (Assume a tax rate of 34%, and round all amounts to whole dollars.)
Prepare a multiple-step income statement
Assume the marketing department has presented a plan to increase advertising expenses by $340 million. It expects this plan to result in an increase in both net sales and cost of goods sold of 25%. (Hint: Increase both sales revenue and sales returns and allowances by 25%.) Redo parts (a) and (b) and discuss whether this plan has merit. (Assume a tax rate of 34%, and round all amounts to whole dollars.) Prepare a multiple-step income statement. (Round answers to O decimal places, e.g. 15,222.) The Clorox Company Income Statement (amounts in millions)Step by Step Solution
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