(Profitability and capital structure analysis) in the year just ended. Callaway Lighting had sales of $5.270.000 and incurred cost of goods sold equal to 54,450,000 The firm's operating expenses were $133,000 and its increase in retained earnings was $43.000 for the year. There are currently 99.000 common stock shares outstanding and the firm pays a $3504 dividend per share the firm has $1.050.000 in interest-bearing debt on which it pays 8 3 percent interest a. Assuming the firm's earnings are taxed at 35 percent, construct the firm's income statement b. Calculate the firm's operating profit margin and net profit margin c. Compute the times interest earned ratio What does this ratio tell you about Callaway's ability to pay its interest expense? d. What is the firm's return on equity? a. Assuming the firm's earnings are taxed at 35% construct the firm's income statement Complete the income statement below. (Round to the nearest dollar) Income Statement Revenues Cost of Goods Sold Gross Proft Operating Expenses Neocom Enter any number in the eat nelas and then continue to the next question. (Profitability and capital structure analysis) in the year just ended Callaway Lighting had sales of $5 270 000 and incurred cost of goods sold equal to $4450.000 The firm's operating expenses were $133.000 and its increase in retained earnings was 543 000 for the year There are currently 99 000 common stock shares Outstanding and the firm pays a $3504 dividend per share the firm has 51 050 000 in interest-bearing debt on which pays 8 3 percent interest a. Assuming the firm's earnings are taxed at 35 percent construct the firm's income statement b. Calculate the firm's operating profit margin and net profit margin c. Compute the times interest earned ratio What does this ratio tell you about Callaway's ability to pay its interest expense? d. What is the firm's return on equity? Cost of Goods Sold Gross Profit Operating Expenses Net Operating Income Interest Expense Earnings before Taxes Income Taxos Plot income Enter any number in the mot nolas and then continue to the next question Completed Assignments (0) e Type here to search (Profitability and capital structure analysis) In the year just ended. Callaway Lighting had sales of $5.270.000 and incurred cost of goods sold equal to 54.450.00 The firm's operating expenses were $133.000 and its increase in retained earnings was $43.000 for the year. There are currently 99,000 common stock shares outstanding and the firm pays a $3.504 dividend per share. The firm has $1,050.000 in interest-bearing debt on which it pays 8 3 percent interest a. Assuming the firm's earnings are taxed at 35 percent construct the firm's income statement b. Calculate the firm's operating profit margin and net profit margin c. Compute the times interest earned ratio What does this ratio tell you about Callaway's ability to pay its interest expense? d. What is the firm's return on equity? b. Calculate the firm's operating profit margin and net profit margin The operating profit margin is % (Round to one decimal place) The net income marginis % (Round to one decimal place) c. Compute the times interesteamed ratio The times interest earned ratio is times Round to one decimal place) What does this ratio tell you about Callaway's ability to pay its interest expense? Select the best choice below) Enter any number in the edit helds and then continue to the next question equi U pj e se expense? What does this ratio tell you about Callaway's ability to pay its interest expense? (Select the best choice below) O A Callaway's operating income can fall as much as 7.9 times the interest expense and the company would still be able to service its debt OB Callaway's operating income can fall as much as 7.9 times and still be able to repay its debt O C. Callaway's interest expense is 7 9 times higher than its competitors OD. Callaway's gross profit can fall as much as 79 times and still be able to service its debt d. What is the firm's return on equity? Select the best choice below) O The firm's return on equity is the same as the operating profit margin 130% Enter any number in the edit fields and then continue to the next