1. It is December 31, 2016 and Mr. X needs your help again. He wants you to create his Income Statement for 2016. Please use the following information to create the 2016 Income Statement.

1. 2016 sales were 125% of 2015 sales
2. Gross profit margin was 55%
3. Operating profit margins were 15%
4. Interest expense fell to 7%, given a change in interest rates
5. The tax rate was 30%

OBD Inc.
Income Statement
For the Year Ended December 31, 2015
Sales	$1,000,000
Cost of goods sold	400,000
Gross profit (60% * $1,000,000)	$ 600,000
Operating expenses
Depreciation expense	5,000
Selling and administrative expense	475,000
Operating income (12% * $1,000,000)	120,000
Interest expense (8% * $300,000)	64,000
Income before income taxes	56,000
Income tax expense (27% * $56,000)	15,120
Net income	$40,880