Income Statement

Bob's Bistro produces party$-$sized hoagie sandwiches. For next year, Bob's Bistro predicts that $54,800$ units will be produced with the following total costs:

Next year, Bob's Bistro expects to purchase $$127,500$ of direct materials. Projected beginning and ending inventories for direct materials and work in process are as follows:

Required:

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 $\mathrm{.}8835$ and entered as $88\mathrm{.}35.$

Bob's Bistro

Income Statement

For the Coming Year

What if the operating expenses percentage for the past few years was $59\mathrm{.}01$ percent? Management's reaction might be: