need part c

Marlyn Terrill is the senlor auditor for the audit of Uden Supply Company for the year ended December 31, 20X4. In planning the audit, Marlyn is attempting to develop expectations for planning analytical procedures based on the financlal Information for prior years and her knowledge of the business and the Industry, Including these: 1. Based on economic conditions, she believes that the increase in sales for the current year should approximate the historical trend in terms of actual dollar Increases. 2 Based on her knowledge of Industry trends, she belleves that the gross profit percentage for 204 should be about 2 percent less than the percentage for 203. 3. Based on her knowledge of regulatlons, she is aware that the effectlve tax rate for the company for 204 has been reduced by 5 percent from that in 203. 4. Based on her knowledge of economic conditions, she is aware that the effectlve interest rate on the company's line of credit for 204 was approximately 12 percent. The average outstanding balance of the IIne of credit is $2,300,000. This line of credit is the company's only Interest-bearling debt. 5. Based on her dlscussions with management and her knowledge of the Industry, she believes that the amount of other expenses should be conslstent with the trends from prior years. Comparatlve Income statement Information for Uden Supply Company is presented in the below table. Required: b. Determine the expected amounts for 204 for each of the income statement Items. (Round gross profit ratio and income taxes ratio to nearest four decimal places. Round other ratios to nearest two decimal places. Round all other intermedlate computations to the nearest whole value. Enter your answers in thousands.) c. Uden's unaudited financlal statements for the current year show a 31 percent gross profit rate. Assuming that this represents a misstatement from the amount that you developed as an expectation, calculate the estimated effect of this misstatement on net income before taxes for 204. (Enter your answers in thousands.) Marlyn Terrill is the senlor auditor for the audit of Uden Supply Company for the year ended December 31, 20X4. In planning the audit, Marlyn is attempting to develop expectations for planning analytical procedures based on the financlal Information for prior years and her knowledge of the business and the Industry, Including these: 1. Based on economic conditions, she believes that the increase in sales for the current year should approximate the historical trend in terms of actual dollar Increases. 2 Based on her knowledge of Industry trends, she belleves that the gross profit percentage for 204 should be about 2 percent less than the percentage for 203. 3. Based on her knowledge of regulatlons, she is aware that the effectlve tax rate for the company for 204 has been reduced by 5 percent from that in 203. 4. Based on her knowledge of economic conditions, she is aware that the effectlve interest rate on the company's line of credit for 204 was approximately 12 percent. The average outstanding balance of the IIne of credit is $2,300,000. This line of credit is the company's only Interest-bearling debt. 5. Based on her dlscussions with management and her knowledge of the Industry, she believes that the amount of other expenses should be conslstent with the trends from prior years. Comparatlve Income statement Information for Uden Supply Company is presented in the below table. Required: b. Determine the expected amounts for 204 for each of the income statement Items. (Round gross profit ratio and income taxes ratio to nearest four decimal places. Round other ratios to nearest two decimal places. Round all other intermedlate computations to the nearest whole value. Enter your answers in thousands.) c. Uden's unaudited financlal statements for the current year show a 31 percent gross profit rate. Assuming that this represents a misstatement from the amount that you developed as an expectation, calculate the estimated effect of this misstatement on net income before taxes for 204. (Enter your answers in thousands.)