Compute the gross margin percentage

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Reference no: EM131706524

The Alpha Company gathered the following condensed data for the year ended December 31, 2014:

Preferred stock dividends paid 

$50,000

Net Sales 

825,000

Interest revenue  

10,000

Selling expenses  

225,000

Administrative expenses  

125,000

Cost of Goods Sold 

400,000

Income tax percentage 

30%


Instructions:

(1) Prepare a multiple-step income statement for the year ended December 31, 2014.

(2) Compute the gross margin percentage and net profit margin ratio. Alpha Company's assets at the beginning of the year were $1,500,000, and the assets were $1,400,000 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.

Reference no: EM131706524

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