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Johnson Controls International plc Data for the year ended September 30, 2023: Item Amount Revenue $30,000,000,000 Cost of Goods Sold $20,000,000,000 Operating Expenses $6,000,000,000

Johnson Controls International plc
 Data for the year ended September 30, 2023:

Item

Amount

Revenue

$30,000,000,000

Cost of Goods Sold

$20,000,000,000

Operating Expenses

$6,000,000,000

Income Tax Expense

$2,000,000,000

Net Income

$2,000,000,000

Total Assets

$50,000,000,000

Total Liabilities

$30,000,000,000

Shareholders' Equity

$20,000,000,000

Managerial Accounting Process:

  1. Recording Costs:
    • Johnson Controls records its cost of goods sold (COGS) at $20 billion, reflecting costs associated with manufacturing HVAC equipment and building automation systems.
    • Operating expenses, including R&D, sales, and administrative costs, are recorded at $6 billion.
  2. Analyzing Costs:
    • Conduct project-level profitability analysis to assess the financial performance of different building efficiency projects and product lines.
    • Perform cost-volume-profit analysis to evaluate the impact of pricing strategies and production volumes on profitability.
  3. Reporting Costs:
    • Present COGS in the income statement to illustrate the direct costs associated with manufacturing and distributing HVAC and building automation products.
    • Detail operating expenses to provide transparency on costs incurred to support innovation, sales initiatives, and corporate functions.
    • Provide cost allocation reports to show how costs are distributed across different business units, geographic regions, and customer segments.

Requirements:

  1. Calculate Johnson Controls' gross profit margin and discuss cost management strategies in the building efficiency and HVAC industry.
  2. Determine Johnson Controls' operating profit margin.




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