Presented below is information for Yates Co. for the month of January 2010.
|
Cost of goods sold |
$212,000 |
Rent expense |
$32,000 |
|
Freight out |
$7,000 |
Sales discounts |
$8,000 |
|
Insurance expense |
$12,000 |
Sales returns and allowances |
17,000 |
|
Salary expense |
62,000 |
Sales |
$370,000 |
Instructions
(a) Prepare an income statement using the format presented on page 239. Assume a 25% tax rate.
(b) Calculate the profit margin ratio and the gross profit rate.