Please provide the formula used for these problems 1) Ajack Co. reported the fol

Question

Please provide the formula used for these problems

1) Ajack Co. reported the following for 2017: Sales = $3MM; Cost of Goods Sold = $1.5MM; Depreciation Expense = $170K; Administrative Expenses = $150K; Interest Expense = $30K; Marketing Expenses = $80K; and Taxes = $300K. Ajack's gross profit is equal to

$770K

$1.07MM

$1.1MM

$1.5MM

2) The Aleris Company reported Net Profit Margin of 4%, COGS of $800K, Taxes of $34K, Sales of $2MM, Interest Expense of $65K and Operating Expenses of $280K for the period.

What is its EBIT?

What is its Net Income?

3) The Markel Company reported Net Profit Margin of 2.5%, COGS of $1.8MM, Operating Margin of 7%, Interest Expense of $105K and Taxes of $89K

Is its GM less than or greater than its Operating Margin?

Explanation / Answer

1. Gross Profit = Sales - Cost of Goods Sold = 3 - 1.5 = 1.5 million
2. Net Income = Sales* Net Margin = 2,000,000* 4% = 80,000
EBIT = Net Income + Taxes + Interest = 80,000 + 34,000 + 65,000 = 179,000

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