need help on question c1 (revised net incomd, revised profit margin)

Homework WILDHORSE DEPARTMENT STORE Income Statement For the Year Ended November 30, 2022 Sales Sales Revenue 2350000 Less : Sales Returns and Allowances 152000) i Net Sales 2298000 Cost of Goods Sold Gross Profit Operating Expenses 87100 i Advertising Expense 16360 Freight-Out Rent Expense Salaries and Wages Expense Utilities Expense Insurance Expense Depreciation Expense Total Operating Expenses (586660) i Income From Operations Other Revenues and Gains Gain on Disposal of Plant Assets 5200 Other Expenses and Losses Interest Expense Income Before Income Taxes Income Tax Expense 126000) i Net Income /(Loss) Liabilities and Stockholders' Equity Current Liabilities Accounts Payable 68,000 Salaries and Wages Payable 15,600 Total Current Liabilities 83600 Long-term Liabilities Notes Payable 113100 Total Liabilities 196700 Stockholders' Equity Common Stock 91,000 Retained Earning 97220 Total Stockholders'Equity 188220 Total Liabilities and Stockholders' Equity Your Answer Correct Answer Calculate the profit margin and the gross profit rate. (Round answers to 1 decimal place, . 15.25) Profit margin Gross profit rate (c1) Your answer is partially correct. The vice president of marketing and the director of human resources have developed a proposal whereby the company would compensate the sales force on a strictly commission basis. Given the increased incentive, they expect net sales to increase by 15%. As a result, they estimate that gross profit will increase by $106,857 and expenses by $145,923. Compute the expected new net income. (Hint: You do not need to prepare an income statement.) Then, compute the revised profit margin and gross profit rate. Comment on the effect that this plan would have on net income and on the ratios, and evaluate the merit of this proposal. Ignore income tax effects.) Revised net income Revised profit margin (Round to 1 decimal place, e.3. 15.2%) Revised gross profit rate (Round to 1 decimal place, s. 15.2%)