Calculate the gross profit rate and the profit margin

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Reference no: EM131264014

Suppose in its income statement for the year ended June 30, 2017, The Clorox Company reported the following condensed data (dollars in millions). Salaries and wages expenses $ 460 Research and development expense $ 110 Depreciation expense 85 Income tax expense 443 Sales revenue 5,735 Loss on disposal of plant assets 50 Interest expense 170 Cost of goods sold 2,758 Advertising expense 430 Rent expense 100 Sales returns and allowances 220 Utilities expense 50 Assume a tax rate of 34%. A)prepare a multi-step income statement B)Calculate the gross profit rate and the profit margin. C)Assume the marketing department has presented a plan to increase advertising expenses by $406 million. It expects this plan to result in an increase in both net sales and cost of goods sold of 25%. Prepare a multiple-step income statement. D)Calculate the gross profit rate and the profit margin.

Reference no: EM131264014

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