Obtain the required input from Nike's income statement's report, see attached file, answer the following: 1) Evaluate the company's marketing profitability and how it contributes to net profit before taxes. 2) How would marketing profits and net profit change if sales increase by 25 percent? 3) Evaluate the profit impact of a strategy in which the gross profit is increased by 5 points and the marketing and sales expenses are increase by 2 points. Make sure to provide enough support and/or examples for your answers. \begin{tabular}{|c|c|c|c|} \hline & A & B & C \\ \hline & Income Statement & & \\ \hline 4Fi & Fiscal Period: & 2022 & \\ \hline & Period End Date: & 20220531 & \\ \hline 6L & Update Type: & Updated Nor & mal \\ \hline & Update Date: & 20220531 & \\ \hline 8s & Source: & 10K & \\ \hline 9 & Source Date: & 20220721 & \\ \hline 10 & Original Announcement Date: & 20220627T2 & 2022:00 \\ \hline 11 & Complete Statement: & Complete & \\ \hline 12 & Flash Update: & No & \\ \hline 13 & Consolidated: & Yes & \\ \hline & Auditor Code: & PWCL & \\ \hline 15N & Net Sales & 46710.0 & \\ \hline 16R & Revenue & 46710.0 & \\ \hline 17. & Total Revenue & 46710.0 & \\ \hline 18 & Cost of Revenue & 25231.0 & \\ \hline 19 & Cost of Revenue. Total & 25231.0 & \\ \hline 20 & Gross Profit & 21479.0 & \\ \hline 21 & Selling/General/Administrative Expense & 10954.0 & \\ \hline 22 & Advertising Expense & 3850.0 & \\ \hline 23 & Selling/General/Admin. Expenses, Total & 14804.0 & \\ \hline 24 & Total Operating Expense & 40035.0 & \\ \hline 25 & Operating Income & 6675.0 & \\ \hline 26 & Interest Expense - Non-Operating & -299.0 & \\ \hline 27 & 7 Interest Expense, Net Non-Operating & -299.0 & \\ \hline 28 & 8 Interest Income-Non-Operating & 94.0 & \\ \hline 29 & 9 Interest/Invest Income - Non-Operating & 94.0 & \\ \hline 30 & 0 Interest Inc. (Exp.). Net-Non-Op. Total & -205.0 & \\ \hline 31 & 1 Other Non-Operating Income (Expense) & 181.0 & \\ \hline 32 & 2 Other, Net & 181.0 & . \\ \hline & 3 Net Income Before Taxes & 6651.0 & \\ \hline 34 & 4 Provision for Income Taxes & 605.0 & \\ \hline 35 & 5 Net Income After Taxes & 6046.0 & \\ \hline 36 & 6 Net Income Before Extra. Items & 6046.0 & \\ \hline & 37 Net Income & 6046.0 & \\ \hline & 38 Income Available to Com Excl ExtraOrd & 60460 & \\ \hline & 39 Income Available to Com Incl ExtraOrd & 6046.0 & \\ \hline \end{tabular} \begin{tabular}{|c|c|c|} \hline 40E & Basic Weighted Average Shares & 1578.8 \\ \hline 41E & Basic EPS Excluding Extraordinary Iten & 382949 \\ \hline 42B & Basic EPS Including Extraordinary Item & 382949 \\ \hline 43D & Diluted Net Income & '6046.0 \\ \hline 44 & Diluted Weighted Average Shares & 16708 \\ \hline 45 & Diluted EPS Excluding ExtraDrd Items & 3.75341 \\ \hline 46. & Diluted EPS Including ExtraOrd lterns & 3.75341 \\ \hline 47 & DPS - Common Stock Primary Issue & 116 \\ \hline 48 & Gross Dividends - Common Stock & 18860 \\ \hline 49 & Normalized Income Before Taxes & 66510 \\ \hline 50 & Inc Tax Ex impact of Sp ltems & 605.0 \\ \hline 51 & Normalized Income After Taxes & 60460 \\ \hline 52 & Normalized Inc Avail to Com & 6046.0 \\ \hline 53 & \begin{tabular}{l} Normalized inc Avail co Lom \\ Basic Normalized EP'S \end{tabular} & 382949 \\ \hline 54 & Diluted Normalized EPS & 375341 \\ \hline 55 & Amort of Intangibles, Supplemental & 1230 \\ \hline 56 & \begin{tabular}{l} Amort of intangibles, Supplemental \\ Depreciation, Supplemental \end{tabular} & \\ \hline 57 & \begin{tabular}{l} Depreciation, Supplemental \\ Interest Expense, Supplemental \end{tabular} & 2990 \\ \hline 58 & \begin{tabular}{l} Interest Expense, Supplemental \\ Rental Expense, Supplemental \end{tabular} & 2990 \\ \hline 59 & \begin{tabular}{l} Rental Expense, Supplemental \\ Stock-Based Compensation. Supplem \end{tabular} & \begin{aligned} 5950 \\ 6380\end{aligned} \\ \hline 60 & \begin{tabular}{l} Stock-Based Lompensation, Suppilin \\ Variable Dperating Lease Expenses \end{tabular} & \\ \hline 61 & \begin{tabular}{l} Variable Lperating Lease Expenses \\ Advertising Expense, Supplemental \end{tabular} & 36500366.0 \\ \hline 62 & \begin{tabular}{l} Advertising Expense, suppierinin \\ Audit Fees \end{tabular} & 781 \\ \hline 63 & \begin{tabular}{l} Audit Fees \\ 3 Audit-Pelated Fees \end{tabular} & \begin{tabular}{ll} 181 \\ 0.3 \end{tabular} \\ \hline 64 & 4 Tax Fees & 0.3 \\ \hline 65 & \begin{tabular}{l} 4 Tax Fes \\ 5 All Other Fees \end{tabular} & \\ \hline 66 & 5 Gross Margin & 4596373 \\ \hline 67 & 7 Gross Margin & 74.2903 \\ \hline 68 & \begin{tabular}{l} 7 - Dperating Marin \\ 8 Prelax Margin \end{tabular} & 14.2903 \\ \hline & \begin{tabular}{l} 8 PrelaxMargin \\ 9 Effective Tax Rate \end{tabular} & 14.25632 \\ \hline 70 & \begin{tabular}{l} 9 Effective Iax hate \\ 0 Net Profit Margin \end{tabular} & 129437 \\ \hline & \begin{tabular}{l} 0 Net Profit Margin \\ 1 Normalized EBIT \end{tabular} & 129431 \\ \hline-72 & \begin{tabular}{l} 1 Normalized EBII \\ 12 Normalized EBITDA \end{tabular} & 75150 \\ \hline & \begin{tabular}{l} 2 Normalized EBITDA \\ 13 Current Tax-Domestic \end{tabular} & 2310 \\ \hline & \begin{tabular}{l} 13 Current Tax-Domestic \\ 14 Current Tax-Foreign \end{tabular} & 9260 \\ \hline & & 980 \\ \hline & & 1255.0 \\ \hline & & -5220 \\ \hline & 77 Deferred Tax-Domestic & -120 \\ \hline & 79 Deferred Tax-Local & -16.0 \\ \hline & 90 Deferred Tax-Total & 6500 \\ \hline & 81 Income Tax-Total & 6050 \\ \hline & 82 Defined Contribution Exp & 1260 \\ \hline & 83 Total Pension Expense. & \begin{tabular}{l} 126.0 \\ 10.0 \end{tabular} \\ \hline & 84 Comp Store Sales (Total - \%) - Retail & 10.0 \\ \hline & \begin{tabular}{l} Merchandise 1 \\ Online Sales \end{tabular} & 79657.0 \\ \hline & & \\ \hline \end{tabular} Obtain the required input from Nike's income statement's report, see attached file, answer the following: 1) Evaluate the company's marketing profitability and how it contributes to net profit before taxes. 2) How would marketing profits and net profit change if sales increase by 25 percent? 3) Evaluate the profit impact of a strategy in which the gross profit is increased by 5 points and the marketing and sales expenses are increase by 2 points. Make sure to provide enough support and/or examples for your answers. \begin{tabular}{|c|c|c|c|} \hline & A & B & C \\ \hline & Income Statement & & \\ \hline 4Fi & Fiscal Period: & 2022 & \\ \hline & Period End Date: & 20220531 & \\ \hline 6L & Update Type: & Updated Nor & mal \\ \hline & Update Date: & 20220531 & \\ \hline 8s & Source: & 10K & \\ \hline 9 & Source Date: & 20220721 & \\ \hline 10 & Original Announcement Date: & 20220627T2 & 2022:00 \\ \hline 11 & Complete Statement: & Complete & \\ \hline 12 & Flash Update: & No & \\ \hline 13 & Consolidated: & Yes & \\ \hline & Auditor Code: & PWCL & \\ \hline 15N & Net Sales & 46710.0 & \\ \hline 16R & Revenue & 46710.0 & \\ \hline 17. & Total Revenue & 46710.0 & \\ \hline 18 & Cost of Revenue & 25231.0 & \\ \hline 19 & Cost of Revenue. Total & 25231.0 & \\ \hline 20 & Gross Profit & 21479.0 & \\ \hline 21 & Selling/General/Administrative Expense & 10954.0 & \\ \hline 22 & Advertising Expense & 3850.0 & \\ \hline 23 & Selling/General/Admin. Expenses, Total & 14804.0 & \\ \hline 24 & Total Operating Expense & 40035.0 & \\ \hline 25 & Operating Income & 6675.0 & \\ \hline 26 & Interest Expense - Non-Operating & -299.0 & \\ \hline 27 & 7 Interest Expense, Net Non-Operating & -299.0 & \\ \hline 28 & 8 Interest Income-Non-Operating & 94.0 & \\ \hline 29 & 9 Interest/Invest Income - Non-Operating & 94.0 & \\ \hline 30 & 0 Interest Inc. (Exp.). Net-Non-Op. Total & -205.0 & \\ \hline 31 & 1 Other Non-Operating Income (Expense) & 181.0 & \\ \hline 32 & 2 Other, Net & 181.0 & . \\ \hline & 3 Net Income Before Taxes & 6651.0 & \\ \hline 34 & 4 Provision for Income Taxes & 605.0 & \\ \hline 35 & 5 Net Income After Taxes & 6046.0 & \\ \hline 36 & 6 Net Income Before Extra. Items & 6046.0 & \\ \hline & 37 Net Income & 6046.0 & \\ \hline & 38 Income Available to Com Excl ExtraOrd & 60460 & \\ \hline & 39 Income Available to Com Incl ExtraOrd & 6046.0 & \\ \hline \end{tabular} \begin{tabular}{|c|c|c|} \hline 40E & Basic Weighted Average Shares & 1578.8 \\ \hline 41E & Basic EPS Excluding Extraordinary Iten & 382949 \\ \hline 42B & Basic EPS Including Extraordinary Item & 382949 \\ \hline 43D & Diluted Net Income & '6046.0 \\ \hline 44 & Diluted Weighted Average Shares & 16708 \\ \hline 45 & Diluted EPS Excluding ExtraDrd Items & 3.75341 \\ \hline 46. & Diluted EPS Including ExtraOrd lterns & 3.75341 \\ \hline 47 & DPS - Common Stock Primary Issue & 116 \\ \hline 48 & Gross Dividends - Common Stock & 18860 \\ \hline 49 & Normalized Income Before Taxes & 66510 \\ \hline 50 & Inc Tax Ex impact of Sp ltems & 605.0 \\ \hline 51 & Normalized Income After Taxes & 60460 \\ \hline 52 & Normalized Inc Avail to Com & 6046.0 \\ \hline 53 & \begin{tabular}{l} Normalized inc Avail co Lom \\ Basic Normalized EP'S \end{tabular} & 382949 \\ \hline 54 & Diluted Normalized EPS & 375341 \\ \hline 55 & Amort of Intangibles, Supplemental & 1230 \\ \hline 56 & \begin{tabular}{l} Amort of intangibles, Supplemental \\ Depreciation, Supplemental \end{tabular} & \\ \hline 57 & \begin{tabular}{l} Depreciation, Supplemental \\ Interest Expense, Supplemental \end{tabular} & 2990 \\ \hline 58 & \begin{tabular}{l} Interest Expense, Supplemental \\ Rental Expense, Supplemental \end{tabular} & 2990 \\ \hline 59 & \begin{tabular}{l} Rental Expense, Supplemental \\ Stock-Based Compensation. Supplem \end{tabular} & \begin{aligned} 5950 \\ 6380\end{aligned} \\ \hline 60 & \begin{tabular}{l} Stock-Based Lompensation, Suppilin \\ Variable Dperating Lease Expenses \end{tabular} & \\ \hline 61 & \begin{tabular}{l} Variable Lperating Lease Expenses \\ Advertising Expense, Supplemental \end{tabular} & 36500366.0 \\ \hline 62 & \begin{tabular}{l} Advertising Expense, suppierinin \\ Audit Fees \end{tabular} & 781 \\ \hline 63 & \begin{tabular}{l} Audit Fees \\ 3 Audit-Pelated Fees \end{tabular} & \begin{tabular}{ll} 181 \\ 0.3 \end{tabular} \\ \hline 64 & 4 Tax Fees & 0.3 \\ \hline 65 & \begin{tabular}{l} 4 Tax Fes \\ 5 All Other Fees \end{tabular} & \\ \hline 66 & 5 Gross Margin & 4596373 \\ \hline 67 & 7 Gross Margin & 74.2903 \\ \hline 68 & \begin{tabular}{l} 7 - Dperating Marin \\ 8 Prelax Margin \end{tabular} & 14.2903 \\ \hline & \begin{tabular}{l} 8 PrelaxMargin \\ 9 Effective Tax Rate \end{tabular} & 14.25632 \\ \hline 70 & \begin{tabular}{l} 9 Effective Iax hate \\ 0 Net Profit Margin \end{tabular} & 129437 \\ \hline & \begin{tabular}{l} 0 Net Profit Margin \\ 1 Normalized EBIT \end{tabular} & 129431 \\ \hline-72 & \begin{tabular}{l} 1 Normalized EBII \\ 12 Normalized EBITDA \end{tabular} & 75150 \\ \hline & \begin{tabular}{l} 2 Normalized EBITDA \\ 13 Current Tax-Domestic \end{tabular} & 2310 \\ \hline & \begin{tabular}{l} 13 Current Tax-Domestic \\ 14 Current Tax-Foreign \end{tabular} & 9260 \\ \hline & & 980 \\ \hline & & 1255.0 \\ \hline & & -5220 \\ \hline & 77 Deferred Tax-Domestic & -120 \\ \hline & 79 Deferred Tax-Local & -16.0 \\ \hline & 90 Deferred Tax-Total & 6500 \\ \hline & 81 Income Tax-Total & 6050 \\ \hline & 82 Defined Contribution Exp & 1260 \\ \hline & 83 Total Pension Expense. & \begin{tabular}{l} 126.0 \\ 10.0 \end{tabular} \\ \hline & 84 Comp Store Sales (Total - \%) - Retail & 10.0 \\ \hline & \begin{tabular}{l} Merchandise 1 \\ Online Sales \end{tabular} & 79657.0 \\ \hline & & \\ \hline \end{tabular}
