Table 2.2 Global Conglomerate Corporation Income Statement Sheet for 2012 and 2011 2011 176.1 (1473) 28.8 (13.0) (7.6) GLOBAL CONGLOMERATE CORPORATION Income Statement Year Ended December 31 (in million) 2012 Total sales 186.7 Cost of sales (153.4) Gross Profit 33.3 Selling, general, and administrative expenses (13.5) Research and development (8.2) Depreciation and amortization (1.2) Operating Income 10.4 Other income Earnings Before Interest and Taxes (EBIT) 10.4 Interest income (expense) (7.7) Pretax Income Taxes (0.7) Net Income 2.0 Earnings per share: $0.556 Diluted earnings per share: 50.526 7.1 7.1 (4.6) 2.5 (0.6) 1.9 $0.528 $0.500 Global has 3.6 million shares outstanding 2-45 Problem 2.4 Suppose that in 2013, Global launches an aggressive marketing campaign that boosts sales by 15%. However, their operating margin falls from 5.57% to 4.50%. Suppose that they have no other income, interest expenses are unchanged, and taxes are the same percentage of pretax income as in 2012. a) What is Global's EBIT in 2013? b) What is Global's net income in 2013