Billkin Company Income Statement For the year ended December 31, Year1 & 2 (dollars in thousands) Year 1 Year 2 Net sales 75,000.00 50,000.00 Less: Cost of goods sold 52,500.00 35,000.00 Gross Margin 22,500.00 15,000.00 Less: Operating expenses 11,452.00 10,000.00 Operating Income 11,048.00 5,000.00 Less: Interest expense 400.00 400.00 Income before taxes 10,648.00 4,600.00 Less: Income taxes (50%) 5,324.00 2,300.00 Net income 5,324.00 2,300.00