Carl's Automotive operating income for the year was $900,000. Their net profit margin was 2.25% and...

Carl's Automotive operating income for the year was $900,000. Their net profit margin was 2.25% and their operating profit margin was 4.25%. Their total taxes amount to 40%. Depreciation was 10% of net fixed assets which totaled $1,250,000. Create their Income statement. Be sure to include all items of an income statement (operating costs, DA, Int, Taxes, etc.).

Expert Solution

Carl Automotive
Income Statement
Particulars		Amount
Revenue
Net Sales	21176471
		21176471

Operating Expenses
Depreciation	125000
Other Operating Expenses	20151471	20276471

Operating income		900000

Interest Expenses		423529

Income before taxes		476471

Income Taxes		190588

Net Income		285882

Calculation of net Sales	Operating Income/Operating profit margin
=	900000/4.25%
=	21176471

Operating Costs	Net Sales-Operating income
=	21176471-900000
=	20276471

Net Profit	Sales*Net profit Margin
=	21176471*2.25%
=	476471

Interest	Operating Profit-Net profit
=	900000-476471
=	423529

Depreciation	Fixed Assets*10%
=	1250000*10%
=	125000

ekkarill92 answered 2 years ago

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