$1.$ Based on economic conditions, she believes that the increase in sales for the current year should approximate the historical

trend in terms of actual dollar increases.

$2.$ Based on her knowledge of industry trends, she believes that the gross profit percentage for $20$X$4$ should be about $2$ percent

less than the percentage for $20$X$3.$

$3.$ Based on her knowledge of regulations, she is aware that the effective tax rate for the company for $20$X$4$ has been reduced by $5$

percent from that in $20$X$3.$

$4.$ Based on her knowledge of economic conditions, she is aware that the effective interest rate on the company's line of credit for

$20$X$4$ was approximately $12$ percent. The average outstanding balance of the line of credit is $$3,500,000.$ This line of credit is the

company's only interest$-$bearing debt.

$5.$ Based on her discussions with management and her knowledge of the industry, she believes that the amount of other expenses

should be consistent with the trends from prior years.