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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:

  1. Calculate the Gross Profit Ratio for each year.
  2. Determine the R&D Expense Ratio for each year.
  3. Compute the Net Profit Margin for each year.
  4. Analyze the company's investment in R&D over the three years.

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