analyze the income statement, business and finance homework help

Option #2: Analyze the Income Statement

The following income statement pertains to Stellar Packaging Products, a U.S. producer of coffee packaging, for the period ending August 2016.

Stellar Packaging Company

Income Statement

For the period ended August 2016



Cost of Goods Sold

$ (1,750,000.00)

Gross Margin


Period (Operating) costs incurred

examples: selling, general, and administrative expenses, etc.


Total operating costs


Operating Income



  1. Compute Stellar Packaging’s gross margin and operating profit margin for August 2016. Recall that thegross margin percentage = gross margin/revenue, andoperating profit margin = operating income/revenue.
  2. Stellar Packaging’s closest publicly held competitor has a gross margin percentage of 30% and a net profit margin of 10%. Compare Stellar Packaging’s performance for August 2016 to that of its competitor. What do you note regarding relative production cost and relative period costs in this comparison? Which company performed better in the period in question? Explain your answer. Refer to your text to aid in this comparison.

Write a paper that meets the following requirements:

Be sure to review the Module 1 Critical Thinking grading rubric, which may be accessed through the Course Information page.

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