Income Statement Pietro Frozen Foods, Inc., produces frozen pizzas. For next year, Pietro predicts that 52,400 units will be produced, with the following total costs: Direct materials Direct labor Variable overhead Fixed overhead 56,000 27,000 180,000 Next year, Pietro expects to purchase $123,000 of direct materials. Projected beginning and ending inventories for direct materials and work in process are as follows: Direct materials Inventory $5,000 $4,900 Work-in-Process Inventory $12,600 $14,600 Beginning Ending Next year, Pietro expects to produce 52,400 units and sell 51,700 units at a price of $14.00 each. Beginning inventory of finished goods is $41,500, and ending inventory of finished goods is expected to be $33,000. Total selling expense is projected at $23,500, and total administrative expense is projected at $121,500. 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 Less operating expenses: 2. What if the cost of goods sold percentage for the past few years was 52.24 percent? Management's reaction might be: Further analyze sales reports Grant bonuses to production personnel Trim administrative staff Investigate production cost management