The Delta Company gathered the following condensed data for the year ended December 31, 2014:
|
Cost of goods sold
|
$300,000
|
|
Net sales
|
525,000
|
|
Administrative expenses
|
110,000
|
|
Interest expense
|
18,000
|
|
Common stock dividends paid
|
25,000
|
|
Selling expenses
|
52,000
|
|
Income tax percentage
|
33%
|
Instructions:
(1) Prepare a multiple-step income statement for the year ended December 31, 2014. (30 points)
(2) Compute the gross margin percentage and net profit margin ratio. Delta Company's assets at the beginning of the year were $800,000, and the total assets were $1,000,000 at the end of the year. To qualify for full credit, you must state the formula you are using, show your computations, and explain your findings.