Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Luther Corporation Consolidated Income Statement Year ended December 31 (in $millions) 2006 2005 Total sales 610.1 550.4550.4 Cost of sales (500.2) (384.7384.7 ) Gross profit

Luther Corporation

Consolidated Income Statement

Year ended December 31 (in $millions)

2006

2005

Total sales

610.1

550.4550.4

Cost of sales

(500.2)

(384.7384.7 )

Gross profit

109.9

165.7165.7

Selling, general, and

administrative expenses

(40.5)

(39.339.3 )

Research and development

(24.6)

(2323 )

Depreciation and amortization

(3.6)

(3.33.3 )

Operating income

41.2

100.1100.1

Other income

minusminus

minusminus

Earnings before interest and taxes (EBIT)

41.2

100.1100.1

Interest income (expense)

(25.1)

(1515 )

Pretax income

16.1

85.185.1

Taxes

(5.5)

(29.78529.785 )

Net income

10.6

55.31555.315

Price per share

$16

$15

Sharing outstanding (millions)

10.2

8.0

Stock options outstanding (millions)

0.3

0.2

Stockholders' Equity

126.6

63.6

Total Liabilities and Stockholders' Equity

533.1

386.7

Refer to the income statement above. Luther's operating margin for the year ending December 31, 2005 is closest to:

A.

9.099.09 %

B.

14.5514.55 %

C.

18.1918.19 %

D.

21.8221.82 %

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Complete Guide To Capital Markets For Quantitative Professionals

Authors: Alex Kuznetsov

1st Edition

0071468293, 978-0071468299

More Books

Students also viewed these Finance questions