Jacob Long, the controller of Arvada Corporation, is trying to prepare a sales budget for the coming year. The income statements for the last four quarters follow: Sales revenue First Quarter $172,000 Second Quarter Third Quarter Fourth Quarter $202,000 $212,000 $262,000 Total $848,000 Cost of goods sold 86,000 101,000 106,000 131,000 424,000 Gross profit 86,000 101,000 106,000 131,000 424,000 Selling & administrative expenses Net income 17,200 20,200 $ 68,800 $ 80,800 21,200 $ 84,800 26,200 84,800 $104,800 $339,200 Historically, cost of goods sold is about 50 percent of sales revenue. Selling and administrative expenses are about 10 percent of sales revenue. Fred Arvada, the chief executive officer, told Mr. Long that he expected sales next year to be 15 percent for each respective quarter above last year's level. However, Rita Banks, the vice president of sales, told Mr. Long that she believed sales growth would be only 10 percent. Required a. Prepare a pro forma income statement including quarterly budgets for the coming year using Mr. Arvada's estimate. b. Prepare a pro forma income statement including quarterly budgets for the coming year using Ms. Banks' estimate. Complete this question by entering your answers in the tabs below. Required A Required B Prepare a pro forma income statement including quarterly budgets for the coming year using Ms. Banks' estimate. Sales revenue Cost of goods sold Gross profit Selling & administrative expenses Net income First Quarter Second Quarter Third Quarter < Required A Required B > Fourth Quarter Total