Panther Corporation appeared to be experiencing a good year. Sales in the first quarter were one-third ahead of last year, and the sales department predicted that this rate would continue throughout the entire year. The controller asked Janet Nomura, a summer accounting intern, to prepare a draft forecast for the year and to analyze the differences from last year's results. She based the forecast on actual results obtained in the first quarter plus the expected costs of production to be completed in the remainder of the year. She worked with various department heads (production, sales, and so on) to get the necessary information. The results of these efforts follow: PANTHER CORPORATION Expected Account Balances for December 31, Year 2 Cash 5,500 Accounts receivable 327,000 Inventory (January 1, Year 2) 216,000 Plant and equipment 555,000 Accumulated depreciation $ 171,000 Accounts payable 187,000 Notes payable (due within one year) 207,000 Accrued payables 100,000 Common stock 350,000 Retained earnings 431,000 Sales revenue 2,470,000 Other income 50,000 Manufacturing costs Materials 830,000 Direct labor 880,000 Variable overhead 574,000 Depreciation 27,000 Other fixed overhead 38,000 Marketing Commissions 94,000 Salaries 71,000 Promotion and advertising 194,000