Chapter S, Problem 3P

Computing Effective Tax Rates

LOS-4 Below is Columbia Sportwear’s 2012 income statement. What is Columbia’s effective tax rate?

COLUMBIA SPORTSWEAR COMPANY Consolidated Statements of Operations (in thousands, except per share amounts)
	2012	Year Ended December 31 2011	2010
Net sales	$1,669,563	$1.693,985	$1,483,524
Cost of sales	953,169	958,677	854,120
Gross profit	716,394	735,308	629,404
Selling, general, and administrative expenses	596,635	614,658	534,068
Net licensing income	13,769	15,756	7,991
Income from operations	133,528	136,406	103,327
Interest income, net	379	1,274	1,564
Income before income tax	133,907	137,680	104,891
Income tax expense (Note 10)	(34,048)	(34,201)	(27,854)
Net income	$99,859	$103,479	$77,037