The income statement of BaltimoreCo. for the 2021 year is presented below. For 2022, the company is expecting a growth in revenues as well as in net income. This expansion will be possible, however only if the following assumptions are correct. 1. Increase the sales of women's clothing in the US by 18%. 2. Add men's clothing for the first time in its product line; total of 8,000 men's suits will be sold in 2022 at an average price of $265 per unit. These coats will be purchased from a South African company at a price of $185 per unit and sold to only Online customers. 3. The cost of goods sold for the existing (US) product line consists of 80% variable and 20% fixed. 4. The operating expenses for the existing line of business are 45% fixed and 55% variable 9of the current operarting expenses) 5. The operating expenses for the online market will be 22% variable (as a percent of online Sales of men's suits): In addition, there will be fixed opearting expenses for the online business in the amount of $78,000/ per year. 19 20 21 A. Calculate the net projected income for 2022, assuming the tax rate changes to 25%. (For the company as a whole) B. Calculate the GP % for 2021 and 2022 for the compnay B. Calculate the profit margin for 2021 and 2022 and the percentage change in the net income. C. Calculate the Break-even points in Units for 2021 22 23 24 variable fixed 473,680 118,420 25 26 Sales (Only US) 27 Cost of Sales 28 Gross Profit 29 Operating Expenses 30 Operating Income 31 Income Tax (20%) 32 Net Income 2021 955,000 592,100 362,900 130,000 232,900 46,580 186,320 2021 (Actual) 2022(Projected) Womens US-Womens Men's-online Total Sales (Only US) 955,000 100.00% 1,126,900 1,480,000 2,606,900 Cost of Sales 62.00% F 592,100 118,420 473,680 362,900 12.40% 49.60% V 558,942 Gross Profit 38.00% Operating Expenses 13.61% F 130,000 58,500 71,500 232,900 6.13% 7.49% V Operating Income 24.39% Income Tax (20% now; 21 25% in 2022) 46,580 4.88% 22 23 Net Income 186,320 19.51% 24 25 Profit Margin 26 27 Percent Change from 2021 28 29 Calculations 30 31 Requireents: 32 1. (955000 x .19 + 9550000