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Calculate Operating Income After Tax

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Question 1
From the following income statement (in millions), calculate operating income after tax using both the top-down and bottom-up methods. Use a tax rate of 37 percent.

Revenue $ 6,450
Cost of goods sold (3,870)
Operating expenses (1,843)
Interest expense (135)
Income taxes (181)
Net income S 421

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The solution is concise and to the point and explains the concepts very well. The solution is very easy to understand as well. Overall, an excellent response to the question being asked.

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Top Down Method

Operating Income = Revenue - COGS - Operating Expenses = ...

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