Boeing's financial margins indicate how well the organization is utilizing sales dollars. Boeing's gross margin increased at the end of 2006 to 17.6 percent from 146 percent in 2005. Gross margin provides insight into the profit available from the sales dollars. Generally, the higher the percentage of gross margin, the more flexible decisions. The the organization can be in its operating ross margin for the industry average is 13.8 percent for 2006 (see Exhibits 2, 3, and 4). Due to its increased flex ility Boeing increased its spending for R&D by nearly $1 billion.