P40Prepare financial statements and calculate profitability ratios. Wolford Department Store is located in midtown Metropolis. During the past several years, net income has been declining because suburban shopping centers have been attracting business away from city areas. At the end of the company's fiscal year on November 30, 2017, these accounts appeared in its adjusted trial balance. Accounts Payable 2,800 35000 Cot of Goods Sold 14 300 5T.0 Depreciation Exponse 3.500 12000 Gain on Disposal o Plant Aset Iscome Tas Expense Insurance Expense Intcrest Expese Soo Notes Payable Propaid Insurance Advertising Expns Rent Expeme Retained Eamings Salarics and Wages Expems Salarics and Wages Payable Sales Retu and Sales Reve Uilities Expens 533 500 4300 117000 Allewances Additional data: Notes payable are due in 2021 Prepare a multiple-step income statement, a retained carnings statement, and a classified balance sheet. Nee 32.900 ot 51460 b) Calculate the profit margin and the gross prolit ratc e 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 $40,443 and expenses by $58,600. 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 menit of this proposal. (lgnore income tax effects)