Using the base case, calculate the composite effects of a 5 percent increase in Sales, a 2 percent decrease in gross margin, and a 5 percent increase is SG&A as a percent of sales.

For the base case In this question, as a percentage of sales, COGS = 61 percent, SGA = 17 percent, R&D= 5 percent. Depreciation, Interest expenses are fixed as stated. Tax rate is 20 percent

Colossal Chemical Corporation Year Ended December 31, 2021 {$000,000 omitted) Base Case Combined Sales $2,110 Cost of goods sold 1,287 Selling-general, and 359 administrative expense Depreciation 121 Research and development 106 Total costs and expenses $ 1,873 Operating Income 237 Interest expense 34 Earnings before Income Taxes $203 Provision for Income Taxes 41 Net Income $ 162