Income Statement

Pietro Frozen Foods, Inc., produces frozen pizzas. For next year, Pietro predicts that $49,200$ units will be produced, with the following total costs:

Direct materials $?$

Direct labor $61,000$

Variable overhead $20,000$

Fixed overhead $205,000$

Next year, Pietro expects to purchase $$126,500$ 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 $$6,000$ $$14,800$

Ending $$5,900$ $$16,800$

Next year, Pietro expects to produce $49,200$ units and sell $48,500$ units at a price of $$17\mathrm{.}00$ each. Beginning inventory of finished goods is $$40,500,$ and ending inventory of finished goods is expected to be $$32,000.$ Total selling expense is projected at $$29,000,$ and total administrative expense is projected at $$114,500.$

Required:

Question Content Area

$1.$ Prepare an income statement in good form. Round the percent to four decimal places before converting to a percentage. For example, $\mathrm{.}88349$ would be rounded to $\mathrm{.}8835$ and entered as $88\mathrm{.}35.$

Note: due to rounding, percentages may not add down.

Pietro Frozen Foods, Inc.

Income Statement

For the Coming Year

Sales: $

Sales: $\%$

Cost of goods sold: $

Cost of goods sold: $\%$

Gross margin: $

Gross margin: $\%$

Less operating expenses: $

Selling expenses: $

Administrative expenses: $

Administrative expenses: $\%$

Operating income: $ and $\%$