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In the income statements of three companies. Cost of Goods Operating Nonoperating Income Tax Company Henry Net Sales Sold Expenses Expenses Expense $42,000 $10,500 $5,500 $2,500 $2,500 Grace 45,000 29,700 16,600 7,500 0 James 50,000 29,000 3,500 0 3,500 Required: 1. For each company, calculate (a) gross profit, (b) operating income, (c) income before income taxes, and (d) net income. 2-a. For each company, calculate the gross profit ratio. 2-b. Which company has the most favorable ratio? Complete this question by entering your answers in the tabs below. Req 1 Req 2a Req 2b Which company has the most favorable ratio? Which company has the most favorable ratio? < Req 2a Req 2b >

In the income statements of three companies. Cost of Goods Operating Nonoperating Income Tax Company Henry Net Sales Sold Expenses Expenses Expense $42,000 $10,500 $5,500 $2,500 $2,500 Grace 45,000 29,700 16,600 7,500 0 James 50,000 29,000 3,500 0 3,500 Required: 1. For each company, calculate (a) gross profit, (b) operating income, (c) income before income taxes, and (d) net income. 2-a. For each company, calculate the gross profit ratio. 2-b. Which company has the most favorable ratio? Complete this question by entering your answers in the tabs below. Req 1 Req 2a Req 2b Which company has the most favorable ratio? Which company has the most favorable ratio? < Req 2a Req 2b >

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Below are amounts found in the income statements of three companies. Cost of Goods Operating Sold Expenses Nonoperating Expenses Income Tax Expense $10,500 $5,500 $2,500 $2,500 45,000 29,700 16,600 7,500 0 50,000 29,000 3,500 0 3,500 Company Henry Net Sales $42,000 Grace James Required: 1. For each company, calculate (a) gross profit, (b) operating income, (c) income before income taxes, and (d) net income. 2-a. For each company, calculate the gross profit ratio. 2-b. Which company has the most favorable ratio? Complete this question by entering your answers in the tabs below. Req 1 Req 2a Req 2b Which company has the most favorable ratio? Which company has the most favorable ratio? < Req 2a Req 2b >
Transcribed Image Text:Below are amounts found in the income statements of three companies. Cost of Goods Operating Sold Expenses Nonoperating Expenses Income Tax Expense $10,500 $5,500 $2,500 $2,500 45,000 29,700 16,600 7,500 0 50,000 29,000 3,500 0 3,500 Company Henry Net Sales $42,000 Grace James Required: 1. For each company, calculate (a) gross profit, (b) operating income, (c) income before income taxes, and (d) net income. 2-a. For each company, calculate the gross profit ratio. 2-b. Which company has the most favorable ratio? Complete this question by entering your answers in the tabs below. Req 1 Req 2a Req 2b Which company has the most favorable ratio? Which company has the most favorable ratio? < Req 2a Req 2b >
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