Local Co. has sales of $10.7 million and cost of sales of $6.5 million. Its selling, general and administrative expenses are $550,000 and its research and development is $1.1 million. It has annual depreciation charges of $1.5 million and a tax rate of 25%. a. What is Local's gross margin? b. What is Local's operating margin? Min
Local Co. has sales of $10.7 million and cost of sales of $6.5 million. Its selling, general and administrative expenses are $550,000 and its research and development is $1.1 million. It has annual depreciation charges of $1.5 million and a tax rate of 25%. a. What is Local's gross margin? b. What is Local's operating margin? Min
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Local Co. has sales of $10.7 million and cost of sales of $6.5 million. Its selling, general and administrative expenses are $550,000 and its research and development is $1.1 million.
It has annual depreciation charges of $1.5 million and a tax rate of 25%.
a. What is Local's gross margin?
b. What is Local's operating margin?
c. What is Local's net profit margin?
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