Complete the following problems: 1. For this problem, use thefollowing randomly generated list of accounts, placing them inappropriate order to prepare an income statement. Accounts($000,000) Depreciation 25 General and administrative expenses 22Sales 345 Sales expenses 18 Cost of goods sold 255 Lease expense 4Interest expense 3 The following randomly constructed tablerequires that as part of your Critical Thinking Assignment youarrange the accounts into a well-labeled income statement. Makesure you label and solve for gross profit, operating profit, andnet profit before taxes. Using a 35% tax rate, calculate taxes paidand net profit after taxes. Assuming a dividend of $1.10 per sharewith 4.25 million shares outstanding, calculate EPS and additionsto retained earnings. 2. Explain why the income statement can alsobe called a “profit-and-loss statement.” What exactly does the wordbalance mean in the title of the balance sheet? Why do we balancethe two halves? 3. CS Industries, Inc. began 2016 with retainedearnings of $25.32 million. During the year, it paid four quarterlydividends of $0.35 per share to 2.75 million common stockholders.Preferred stockholders, holding 500,000 shares, were paid twosemiannual dividends of $0.75 per share. The firm had a net profitafter taxes of $5.15 million. Prepare the statement of retainedearnings for the year ended December 31, 2016. 4. Sky Metals, Inc.is a metal fabrication firm that manufactures prefabricated metalparts for customers in a variety of industries. The firm’s motto is“If you need it, we can make it.” The CEO of Sky Metals recentlyheld a board meeting during which he extolled the virtues of thecorporation. The company, he stated confidently, had the capabilityto build any product and could do so using a lean manufacturingmodel. The firm would soon be profitable, claimed the CEO, becausethe company used state-of-the-art technology to build a variety ofproducts while keeping inventory levels low. As a business pressreporter, you have calculated some ratios to analyze the financialhealth of the firm. Sky Metals' current ratios and quick ratios forthe past 6 years are shown in the following table: 2010 2011 20122013 2014 2015 2015 Current ratio 1.2 1.4 1.3 1.6 1.8 2.2 2.2 Quickratio 1.1 1.3 1.2 0.8 0.6 0.4 0.4 What do you think of the CEO’sclaim that the firm is lean and soon to be profitable? 5. If weknow that a firm has a net profit margin of 4.5%, total assetturnover of 0.72, and a financial leverage multiplier of 1.43, whatis its ROE? What is the advantage to using the DuPont system tocalculate ROE over the direct calculation of earnings available forcommon stockholders divided by common stock equity?