Answer:
a. $37,500
b. $22,800
Explanation:
The computation is shown below:
a. For operating income
Net Sales $300,000
Less: Cost of Goods Sold -$165,000
Gross Profit $135,000
Less: Selling, general and administrative Expenses $66,000
Less: Research and development expenses $31,500
Operating Income (EBIT) $37,500
b. For the net income
Operating Income (EBIT) $37,500
Less: Interest Expense -$7,100
Earnings before Tax (EBT) $30,400
Less: Taxes $7,600
Earnings after Tax or Net Income $22,800
We simply applied the above equation or format for determining the operating income and net income
