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World 15 Company 2 Year 5 Quarter 1 CONSOLIDATED INCOME STATEMENT 11-07-2013 A BUSINESS POLICY GAME, 6TH EDITION 13:36:02 Copyright (c) 2010 by Richard V. Cotter and David J. Fritzsche ____________________________________________________________________________ Consoli- Merica Merica Merica dated Area 1 Area 2 Area 3 Sereno M$000s M$000s M$000s M$000s Ps000s Net Sales: to Customers 4819 1130 1300 1150 7956 to Affiliates (cost + 20%) 0 0 2524 0 0 to Liquidators (at cost) 0 0 0 0 0 Less Cost of Goods sold 2531 823 2766 913 3550 Less Value Added Tax 124 0 0 0 796 Gross Profit 2164 307 1058 237 3610 Selling Expense: Advertising Expense 211 50 55 50 360 Sales Salaries 144 33 51 36 152 Sales Commissions 95 24 30 24 112 General Selling Expense 581 120 152 126 1177 Transportation Expense 310 117 15 117 394 Sales Office Depreciation 12 3 3 3 19 Total Selling Expense 1354 347 306 356 2214 Admin and General Expense: Research and Development 60 0 60 0 0 Total Training Expense 30 0 30 0 0 Storage Expense 5 0 5 0 0 Executive Compensation 252 29 87 29 685 Other Expense 15 0 15 0 0 Total Adm & Gen Expense 362 29 197 29 685 Total Operating Expense 1716 376 503 385 2899 Operating Profit (Loss) 449 -69 555 -148 711 Other Income: CD Interest 6 0 6 0 0 Capital Gain (Loss) 0 0 0 0 0 Other Expense: Loan Interest 0 0 0 0 0 Bond Interest 50 0 50 0 0 Net Profit (Loss) Before Tax 405 -69 511 -148 711 Less Income Tax 158 0 115 0 277 Net Profit (Loss) After Tax 247 -69 396 -148 434 Foreign Currency Adjustment 148 Comprehensive Income(Loss) 99 -69 396 -148 434 ____________________________________________________________________________ Tax Loss Carry-Forward -69 0 -148 0 Notes: Translation Exchange Rate 1.00 1.00 1.00 6.42 Minor differences in translation may be due to rounding errors. Purchases from Affiliates is consolidated with Sales to Affiliates. Dividends to Parent is consolidated with Dividends from Subsidiaries.