Question

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.).

Answer 1

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