Income Statement

Pietro Frozen Foods, Inc., produces frozen pizzas. For next year, Pietro predicts that 51,600 units will be produced, with the following total costs:

Direct materials	?
Direct labor	55,000
Variable overhead	27,000
Fixed overhead	205,000

Next year, Pietro expects to purchase $127,000 of direct materials. Projected beginning and ending inventories for direct materials and work in process are as follows:

	Direct materials Inventory	Work-in-Process Inventory
Beginning	$7,000	$11,300
Ending	$6,900	$13,300

Next year, Pietro expects to produce 51,600 units and sell 50,900 units at a price of $13.00 each. Beginning inventory of finished goods is $39,500, and ending inventory of finished goods is expected to be $31,000. Total selling expense is projected at $22,500, and total administrative expense is projected at $106,000.

Required:

1. 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 .8835 and entered as 88.35.

Pietro Frozen Foods, Inc.
Income Statement
For the Coming Year
			Percent
Sales		$fill in the blank 1a426a05af82fb1_2	fill in the blank 1a426a05af82fb1_3%
Cost of goods sold		fill in the blank 1a426a05af82fb1_5	fill in the blank 1a426a05af82fb1_6%
Gross margin		$fill in the blank 1a426a05af82fb1_8	fill in the blank 1a426a05af82fb1_9%
Less operating expenses:
Selling expenses	$fill in the blank 1a426a05af82fb1_11
Administrative expenses	fill in the blank 1a426a05af82fb1_13	fill in the blank 1a426a05af82fb1_14	fill in the blank 1a426a05af82fb1_15%
Operating income		$fill in the blank 1a426a05af82fb1_17	fill in the blank 1a426a05af82fb1_18%