rill in ne missing values (yellow Doxe5) TOr e Income statement Delow, glven e T

Question

rill in ne missing values (yellow Doxe5) TOr e Income statement Delow, glven e TOI IOwlng information: Gross margin is 28% Direct labor costs are 3/4 the amount of Direct materials costs Times-interest-earned ratio is17.0 Tax rate is 35% Mashayekhi and Meckstroth Merchandising, Inc. Income Statement as of the year ending September 30, 2017 (in thousands) Sales revenue Less: Cost of goods sold $ 65,990 Direct materials Direct labor Manufacturing overhead 20,240 Total cost ofgoods sold Gross profit Less: Operating expenses Selling expenses 3,220 General and administrative expenses Total operating expenses Earnings before interest and taxes Interest expense Income before incometaxes Income tax expense NETINCOME (LOSS) 850

Explanation / Answer

Mashayekhi and Meckstroth Merchandising Inc. Income statement as of the year ending september 30,2017 (in thousands) Sales 65990 Less : Cost of goods sold DIrect material 20240 DIrect labour (20240*3/4) 15180 Manufacturing overhead 12092.80 Total cost of goods sold 47512.80 Gross profit (65990*28%) 18477.20 Less: Operating expenses Selling expenses 3220 General and administrative expenses 807.20 Total operating expenses 4027.20 Earning before interest and taxes (850*17) 14450 Interest expense 850 Income before income taxes 13600 Income tax expense (13600*35%) 4760 Net income (loss) 8840

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