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Kim Clover, the controller of Jones Corporation, is trying to prepare a sales budget for...

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Accounting

Kim Clover, the controller of Jones Corporation, is trying to prepare a sales budget for the coming year. The income statement for the previous fiscal year is as follows:
Income Statement Prior Year
Sales revenue $400,000
Cost of goods sold (280,000)
Gross profit 120,000
Selling & administrative expenses (80,000)
Net income $40,000
Historically, cost of goods sold is about 70 percent of sales revenue. Selling and administrative expenses are about 20 percent of sales revenue. Mary Swanson, the chief executive officer (CEO), told Kim Clover that she expected sales next year to be 10 percent above prior year sales.
Required:
Prepare a pro forma income statement for the coming year using the historical averages and the CEOs estimate regarding sales.
Note: Enter amounts to be deducted with a minus sign.
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