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Income Statement Pietro Frozen Foods, Inc., produces frozen pizzas. For next year, Pietro predicts that 47,900 units will be produced, with the following total costs: Direct materials Direct labor Variable overhead Fixed overhead ? 64,000 20,000 180,000 Next year, Pietro expects to purchase $115,500 of direct materials. Projected beginning and ending inventories for direct materials and work in process are as follows: Beginning Ending Direct materials Inventory $4,000 $3,900 Work-in-Process Inventory $13,800 $15,800 Next year, Pietro expects to produce 47,900 units and sell 47,200 units at a price of $15.00 each. Beginning inventory of finished goods is $47,500, and ending inventory of finished goods is expected to be $39,000. Total selling expense is projected at $24,000, and total administrative expense is projected at $115,000. Required: 1. Prepare an income statement in good form. Round the percent to four decimal places before converting to a percentage. For example, .88349 would be rounded to .8835 and entered as 88.35. Note: due to rounding, percentages may not add down. Pietro Frozen Foods, Inc. Income Statement For the Coming Year Percent % % % Sales Cost of goods sold Gross margin Less operating expenses: Selling expenses Administrative expenses % % 2. What if the cost of goods sold percentage for the past few years was 51.53 percent? Management's reaction might be

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