I need help with this question asap can u please help me in

I need help with this question asap, can u please help me in solving this question.

Local Co. has sales of $10.7 million and cost of sales of $6.1 million. Its selling, general and administrative expenses are $540,000 and its research and development is $1.1 million. It has annual depreciation charges of $1.4 million and a tax rate of 35%. a What is Local\'s gross margin? b. What is Local\'s operating margin? c. What is Local\'s net profit margin? a. What is Local\'s gross margin? Local\'s gross margin is (Round to one decimal place.)

Solution

a) Gross margin = (Sales - Cost of goods sold) /Sales = (10.7 - 6.1)/10.7 = 42.99%
b) Operating margin = (Sales - Cost of goods sold - SGA expenses -depreciation) /Sales = ( 10.7 - 6.1 - 0.84 - 1.4 )/10.7 = 22.06%
c) Net Profit margin = (Sales - Cost of goods sold - SGA expenses - Depreciation) * ( 1- tax rate) /Sales
=( 10.7 - 6.1 - 0.84 - 1.4 ) * ( 1 - 35%)/10.7 = 14.34%

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