Question
Software Solutions Inc. reports the following financial results for the past three years. Description 2021 2020 2019 Total Revenue $4,000,000 $3,800,000 $3,600,000 Cost of Revenue
Software Solutions Inc. reports the following financial results for the past three years.
Description | 2021 | 2020 | 2019 |
Total Revenue | $4,000,000 | $3,800,000 | $3,600,000 |
Cost of Revenue | $2,400,000 | $2,280,000 | $2,160,000 |
Gross Profit | $1,600,000 | $1,520,000 | $1,440,000 |
Research and Development | $800,000 | $760,000 | $720,000 |
Selling, General, and Admin | $400,000 | $380,000 | $360,000 |
Total Operating Expenses | $1,200,000 | $1,140,000 | $1,080,000 |
Operating Income | $400,000 | $380,000 | $360,000 |
Other Income | $80,000 | $76,000 | $72,000 |
Earnings Before Tax | $480,000 | $456,000 | $432,000 |
Tax Expense | $96,000 | $91,200 | $86,400 |
Net Income | $384,000 | $364,800 | $345,600 |
Requirements:
- Calculate the Gross Profit Ratio for each year.
- Determine the R&D Expense Ratio for each year.
- Compute the Net Profit Margin for each year.
- Analyze the company's investment in R&D over the three years.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started