The Caltor Company

The Caltor Company gathered the following condensed data for the year ended December 31, 2010:

Cost of goods sold $ 710,000

Net sales 1,279,000

Administrative expenses 239,000

Interest expense 68,000

Dividends paid 38,000

Selling expenses 45,000

Instructions:

Prepare a multiple-step income statement for the year ended December 31, 2010.

Compute the profit margin ratio and gross profit rate. Caltor Company s assets at the beginning of the year were $770,000 and were $830,000 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.