• McDonald's Corporation faced $1 billion in increased labor costs due to wage hikes across its global operations. The company reported the following financial data:
  • Increased Labor Costs: $1 billion
  • Total Revenue: $21 billion
  • Operating Expenses: $14 billion
  • Net Income: $5 billion

• Requirements:
  1. Calculate McDonald's net income after accounting for the increased labor costs.
  2. Prepare an income statement showing the impact of increased labor costs on operating income.
  3. Analyze McDonald's operating profit margin before and after the increased labor costs.
  4. Discuss the disclosure requirements for significant increases in labor costs in McDonald's financial statements.
  5. Evaluate McDonald's strategies for managing labor costs and maintaining profitability.