Problem

Understanding income statement relationships During the year, net sales were $125,00...

Understanding income statement relationships During the year, net sales were $125,000; gross profit was $50,000; net income was $20,000; income tax expense was $5,000; and selling, general, and administrative expenses were $22,000.

Required:

Calculate cost of goods sold, income from operations, income before taxes, and interest expense. (Hint: Exhibit 2-2 may be used as a solution model.)

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