Masco Corporation performs year-end planning in November of each year before its calendar year ends in December. ng Changes Masco's Chief Financial Officer Patricia Maloney meets with it's President AJ Hoyt to review her projections. Masco Corporation Sales Revenue Interest Revenue Cost of Goods Sold Depreciation Expense Operating Expenses Bonus Pre-tax Financial Income Income Taxes Net Income Projected Income Statement For the Year Ended December 31, 2024 Oher Information at December 31, 2024: Equipment 14,000,000 2,600,000 6,400,000 1,000,00 Accumulated Depreciation (5-year SL) 20% Masco Corporation Selected Balance Sheet Information At December 31, 2024 Estimated Cash Balance change to Available-for-Sale Debt Investments (at cost) Trade in securities Securities Fair Value Adjustment Account (1-1-2024) Investment Securities Estimated Fair Value at December 31, 2024: Cost Security A 2,000,000 B 4,000,000 C D 2 3,000,000 1,000,000 10,000,000 New Robotic Equipment (to be purchased 1-1-2024) Accumulated Depreciation (5-year DDB) 28,995,000 5,000 23,000,000 46,000,000 $7 M of Pre-tax financial in Came 1,200,000 240,000 4,800,000 5,000,000 10,000,000 Estimated FV 2,200,000 3,900,000 3,100,000 1,800,000 11,000,000 3,000,000 (1,200,000) 29,000,000 5,000,000 (2,000,000) no more than this amt. The Corporation has never used robotic equipment before and Patricia assumed an accelerated method of depreciation because of the rapidly changing technology in robotic equipment. The Corporation normally uses straight-line depreciation for its production equipment. to Take bonus into consideration it's included in the pre-tak AJ explains to Patricia that it is important for the Corporation to show Pre-tax Financial Income of at least 6,000,000? $7,000,000 because AJ receives a $1,000,000 bonus if Pre-tax Financial Income, before bonus, reaches $7,000,000 Furthermore, AJ does not want the Corporation to pay more than $1,200,000 in income taxes. Address what Patricia can do within the confines of US GAAP to accomondate AJ's wishes. Your response must include a revised Projected Income Statement reflecting your decisions. Write a detailed memorandum explaining your projected changes to the Board of Directors.

Masco Corporation performs year-end planning in November of each year before its calendar year ends in December. Masco's Chief Financial Officer Patricla Maloney meets with it's President A Hoyt to review her projections. Masco Corporation Projected Income Statement For the Year Ended December 31, 2024 Sales Revenue Interest Revenue Cost of Goods Sold Depreciation Expense Operating Expenses Banis Pre-tax Financial Income Income Taxes Net Income 28 14,000,000 \begin{tabular}{l} 2,600,000 \\ 6,400,000 \\ \hline \end{tabular} 6,400,0001,000,009 20% 23,000,0006,000,000 \begin{tabular}{|r|r|} \hline 1,200,000 \\ \hline 4,800,000 \\ \hline \end{tabular} Masco Corporation Selected Balance Sheet Information At December 31, 2024 Estimated Cash Balance Available-for-Sale Debt Investments (at cost) Securities Fair Value Adjustment Account (1-1-2024) Investment Securities Estimated Fair Value at December 31, 2024: \begin{tabular}{|c|r|r|} \hline Security & Cost & Estimated FV \\ \hline A & 2,000,000 & 2,200,000 \\ \hline B & 4,000,000 & 3,900,000 \\ \hline C & 3,000,000 & 3,100,000 \\ \hline D & 1,000,000 & 1,800,000 \\ \hline & 10,000,000 & 11,000,000 \\ \hline \end{tabular} 5,000 Scemone A explains to Patricia that it is important for the Corporation to show Pre-tax Financial lncome of at least. $7,000,000 because AJ receives a $1,000,000 bonus if Pre-tax Financial Income, before bonus, reaches $7,000,000. Furthermore, A does not want the Corporation to pay more than $1,200,000 in income taxes. Address what Patricia can do within the confines of US GAAP to accomondate AJ's wishes. Your response must include a revised Projected Income Statement reflecting your decisions. Write a detailed memorandum explaining your projected changes to the Board of Directors