Sh2 Dr. Zhivago Diagnostics Corporation's income statement for 20X1 is as follows:$ 2,790,0002,070,000SalesCost of goods soldGross profitSelling and administrative expenseOperating profitInterest expenseIncome before taxesTaxes (30%)Income after taxesa. Compute the profit margin for 20X1.Note: Input the profit margin as a percent rounded to 2 decimal places.Profit margin$ 720.000350.000$ 370,00051.400$ 318,60095 580$223,920% b. Assume that in 20X2, sales increase by 10 percent and cost of goods sold increases by 20 percent. The firm is able to keep allother expenses the same. Assume a tax rate of 30 percent on income before taxes. What is income after taxes and the profit marginfor 20X2?Note: Input the profit margin as a percent rounded to 2 decimal places.Income after taxesProfit margin20X2

The profit margin is the portion of sales that a company keeps after all costs have been paid. It…

Dr. Zhivago Diagnostics Corporation's income statement for 20X1 is as follows: $ 2,790,000 2.070.000 $720,000 Sales Cost of goods sold Gross profit Selling and administrative expense Operating profit Interest expense Income before taxes Taxes (30%) Income after taxes Profit margin 350.000 $ 370,000 51,400 a. Compute the profit margin for 20X1. Note: Input the profit margin as a percent rounded to 2 decimal places. % $ 318,600 95,580 $223,020