The following information was taken from Logsden Manufacturing€™s trial balances as of December 31, 2010, and December 31, 2011.

Required:
1. Calculate the gross profit margin and operating margin percentage for 2011.
2. Assuming that all of the operating expenses are fixed (or, won€™t change as sales increase or decrease), what will be the operating margin percentage if sales increase by 25 percent?

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12/31/2011 12/31/2010 Accounts receivable Accounts payable Cost of goods sold Sales Sales returns Retained earnings Dividends Income from operations Net income $13,000 17,000 15,000 119,000 239,000 11,000 16,000 1,000 16,000 18,000 22,000 140,000 274,000 12,000 47,000 5,000 25,000 21,000