Refer to the income statement below for The Gap, Inc. Consolidated Statement of Earnings Fiscal year ended...

4.0 Ratings (652 Votes)

Common size income statement
	2015	% of sales = value of individual item/sales value	2014	% of sales = value of individual item/sales value
sales	16435	100%	16148	100%
less cost of goods sold	10146	61.73%	9855	61.03%
gross profit	6289	38.27%	6293	38.97%
operating expenses	4206	25.59%	4144	25.66%
operating profit	2083	12.67%	2149	13.31%
interest expense	-75	-0.46%	-61	-0.38%
interest income	5	0.03%	5	0.03%
income before income tax	2013	12.25%	2093	12.96%
income tax	751	4.57%	813	5.03%
net income	1262	7.68%	1280	7.93%

net sales	15000
cost of goods sold-65% of net sales	9600
gross profit	5400
operating expense-26% of sales	3900
operating profit	1500
interest expense	-75
interest income	5
income before income tax	1430
less income tax-26%	557.7
net income	872.3

Accurcy of proforma income statement will depend on the accuracy to predict the value of sales and value of cost of goods sold.

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