• Starbucks Corporation incurred $1.2 billion in restructuring costs related to closing underperforming stores and streamlining operations. The company provided the following financial figures:
  • Restructuring Costs: $1.2 billion
  • Total Revenue: $25 billion
  • Operating Income: $5 billion
  • Net Income: $3 billion

• Requirements:
  1. Calculate Starbucks' net income after accounting for the restructuring costs.
  2. Prepare a comparative income statement showing the impact of restructuring costs on net income.
  3. Analyze the operating profit margin before and after the restructuring costs.
  4. Discuss the strategic reasons for undertaking restructuring activities and their financial implications.
  5. Evaluate Starbucks' ability to maintain profitability amid restructuring efforts.