Frank Company has the following income statements available:
2X13 2X12
Sales $900 $800
Less Cost of Goods Sold 470 440
Gross Profit $430 $360
Operating Expenses:
Wage Expense $ 95 $ 90
Rent Expense 35 30
Miscellaneous Expense 20 15
Depreciation Expense 25 20
Total Operating Expenses $175 $155
Operating Income $255 $205
Less Other Expenses:
Interest Expense 15 10
Income Before Taxes $240 $195
Less Income Tax Expense 110 85
Net Income $130 $110
What is the percentage increase or (decrease) in operating income and income before taxes from 2X12 to 2X13 for Frank Company?
Operating Income Income Before Taxes
A) 24.4% 23.1%
B) 19.4% 24.4%
C) 18.8% 19.6%
D) 19.6% 18.8%
E) 24.4% 18.8%
A
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Bob invested $2,000 in an investment fund on his 21st birthday. The fund pays 7% interest compounded
semiannually. Bob is celebrating his 50th birthday today. Bob decides he wants to retire on his 60th birthday and he wants to withdraw $75,000 per year, the first withdrawal on his 60th birthday and the last withdrawal on his 90th birthday. Bob expects to receive $100,000 from his employer on his 55th birthday in recognition of his long service to the company. Assume Bob has not taken any money out of his investment fund since he initially funded it on his 21st birthday, and that he will deposit the $100,000 from his employer into the investment fund on his 55th birthday. The investment fund will be used to pay for Bob's retirement. If Bob makes no additional deposits into his investment fund, how much will be available for retirement at age 60? Since the amount in (a) is insufficient to meet his retirement goals, Bob decides to deposit equal annual amounts into the investment fund beginning on his 51st birthday and ending on his 59th birthday, so that he can meet his retirement goals. How much will each deposit be?